Gold And Silver sideways; Goldman Sachs And TDS See Upside Potential

Gold and silver can be somehow bearish in the short term, but big names like Goldman Sachs and TDS expect bullish moves in the long run.
Mauricio Carrillo
Gold price bars and chart

Gold and Silver are trading sideways on Tuesday as investors are waiting for developments in the US-China trade deal and more economic data.

The market expects more declines in the short term, but in any case, short-lived, as big names are forecasting possible gains in the long run.

Goldman Sachs boosts gold and silver price forecast

Global financial giant Goldman Sachs has boosted its forecast for the gold price to USD 1,450/oz in the next 12 months.

However, it is also tampering commodities expectations as it now recommends neutral position as commodities are no longer significantly undervalued.

Goldman Sachs also hiked its silver price forecast by 25 cents each time window.

The firm now expects silver at $16.50 in 3 months, $17.00 in 6 months and $17.50 in one year.

Goldman Sachs cites strong employment conditions in US that will keep late-cycle worries elevated. Also, low European growth with negative real rates boosting European ETFs.

Additionally, geopolitical tensions will remain elevated, pushing risk appetite down and bets on less risky assets.

Gold consolidates 6-week lows around $1,285

Gold is trading in consolidation mode following the latest bearish movement that pushed the XAU/USD to levels not seen since January 25.

XAU/USD is now slightly down on the day, at $1,285, 0.10% down on Tuesday. The pair is performing its fifth negative day in a row, but bears look exhausted.

Minor bounce expected for the short term, but the chart is suggesting more declines at least this week. However, the big picture looks different as fundamental stories are pushing the yellow metal up.

TDS recommends buying Gold

Recent optimism on the economic front has pushed gold prices down to trade around $1,300. However, Analysts at TDS believes deteriorating global growth in the middle term should support gold prices.

TDS is recommending to buy gold around $1,298 with a target of $1,360 in a 3-month window. Stop loss at $1,270.

According to TDS, “a poor economic outlook in Europe, irrespective of idiosyncratic issues, along with continued disappointments on the Chinese economic front and slowing US growth into 2019 should all conspire to reduce risk appetite.”

“TD Securities CTA tracking algorithm suggests that the bar for increasing systematic length is fairly low,” TDS continues, “with key upside trigger levels standing in the low $1300 range.”

Silver finds support at 15.05

Silver is trading positive on Tuesday as the XAG/USD has finally found support at 15:05 after four negative days in a row.

XAG/USD is currently moving at 15.11, 0.21% positive on the day. However, the unit seems limited by the 15.15 level that is working as resistance.

The 200-day moving average is at that level too. So, as the XAG/USD broke below that area on Monday, it is now working as a strong resistance for the upside.

Palladium unable to break $1,670 area

Palladium is trading in a range between $1,515 and $1,560 as the pair is consolidating all-time highs around 1,570 reached on February 26 and 27.

XPD/USD is performing two negative days in a row for the first time since January 22 when the unit logged three negative days.

On the day, Palladium is trading 0.80% negative against the US Dollar at $1,520.70.

Pair is testing the bottom of the range. A break below would open the door to sub-1,500 prices.

The target would be the 20-day moving average at $1,470.00.

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