Gold Prices Rise and Momentum is Positive

Gold prices continued to move higher following a report that Russia was likely to attack Ukraine sooner rather than later. The White House said that American’s should leave Russia within the next 24-48 hours. U.S. yields edged lower following a surge in prices on Thursday in the wake of the stronger than expected U.S. inflation report. The interest rate curve is currently pricing 6-interest rate hikes in 2022. The University of Michigan reported very disappointing consumer sentiment data, the lowest in more than a decade.

Technical Analysis

Gold prices rallied. Prices remain above support near the 10-day moving average at 1,816. Resistance is seen near a downward sloping trend line that comes in near $1,856. Short-term momentum is positive as the fast stochastic generated a crossover buy signal. Medium-term momentum is positive as the MACD (moving average convergence divergence) index has generated a crossover buy signal. This situation 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). The MACD histogram prints in positive territory with an upward sloping trajectory pointing to higher prices.

Sentiment Slides

In February, the University of Michigan’s consumer sentiment index declined 5.5 points to 61.7. This figure is the lowest print since 60.8 in October 2011. Expectations were for consumer sentiment to come in slightly below the December print at 67. The expectations component of the consumer sentiment survey dropped to 57.4, which is also the lowest point in more than a decade. In 2021 the index hit a high of 88 in April, as COVID restrictions were eased.