Gold Price Prediction – Gold Drops on Robust Consumer Sentiment

Gold prices slide on strong sentiment
David Becker
Gold and U.S. Dollar

Gold prices dipped on Friday, and continued to slide toward support levels. Stronger than expected confidence levels, helped buoy US yields which bolstered the US dollar paving the way for lower gold prices. Sentiment relative to trade remained volatile, as headlines over the US and China trade spat kept markets on edge. It appears that the markets are pricing in tariffs for the long haul. The US and Canada announced that they would both lift steel and aluminum tariffs. This gave some riskier assets a boost.

Technical Analysis

Gold prices moved lower and held just above support near an upward sloping trend line that comes in near 1,273. A break would test the April lows near 1,265. Short term momentum has turned negative as the fast stochastic recently generated a crossover sell signal. The stochastic is accelerating away from the signal line which also reflects accelerating negative short-term momentum. The current reading of 53 is in the middle of the neutral range and reflects consolidation. Medium term momentum is turning negative as the MACD (moving average convergence divergence) index is poised to generate a crossover sell signal. The MACD histogram is printing in the black with a declining trajectory which reflects consolidation.

Consumer Sentiment Beats Expectations

Consumer sentiment surged its highest level in 15 years in early May. The University of Michigan’s preliminary consumer sentiment index rose to 102.4, up from 97.2 in April beating expectations of 97.5. The period measured generally fell during a period prior to the latest US-China trade spat, earlier in May. This will likely change following the increase in US trade tariffs on Chinese goods and their reciprocal actions.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.