Gold: Recovery builds with easing Dollar – OCBC

OCBC strategists Christopher Wong and Sim Moh Siong highlight that Gold has extended its recovery as the Dollar and Oil prices retreat and risk sentiment stabilises on signs the Iran conflict may be nearing an end. They note earlier asset liquidation, slower official sector buying and Fed uncertainty had weighed on Gold, but expects demand to return with support at 5105–5060 and resistance at 5260–5315.

Recovery continues with defined key levels

"Gold extended its recovery as USD and oil prices retraced lower while risk sentiment tentatively stabilised on signs that the conflict in Iran may possibly be near its end."

"Price action was also consistent with our posturing that asset liquidation to raise cash during market stresses may have partially explained why gold struggled to break out."

"Other factors that had weighed on gold are the risk of Fed slowing or delaying next rate cut as rising oil prices may stoke potential inflationary risks for US while gold purchase momentum in the official sector slowed."

"When this phase of flight to safety passes, prior moves should unwind and demand for gold is likely to return."

"Resistance at 5260, 5315 levels. Support at 5105 (21 DMA), 5060 levels."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)