Gold Price Prediction – Prices Rise Despite Declining ISM

Gold prices moved higher, recapturing support levels as silver surged more than 7%, driven by Reddit investors.  The price of the yellow metal increased despite a rally in the dollar and rising US yields.  Construction spending increased 1.0% to $1.490 trillion, the highest level since the government started tracking the series in 2002. That followed a 1.1% jump in November. U.S. manufacturing activity slowed slightly in January, while prices paid by factories for raw materials surged to the highest level in nearly 10-years

Technical analysis

Gold prices moved higher but remain rangebound. Prices remain below resistance near the 10-day moving average at 1,849. Prices recapture support near the 10 and 50-day moving average, which are seen near $18.54 and $18,55. Resistance is seen near the January highs at $1,871.  Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. Medium-term negative momentum also generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).

ISM Manufacturing Slowed in January

Manufacturing activity slowed in January, while prices paid for raw materials jumped to its highest level in nearly 10 years. The ISM’s national factory activity index fell to a reading of 58.7 last month from 60.5 in December. Expectations had been for the index to come in at 60 in January.