Gold Monthly Forecast: October 2024 (Chart)
Date
9/30/2024 2:53:28 PM
(MENAFN- Daily Forex)
Gold markets have been absolutely explosive during the month of September, and I do believe that the upward momentum continues. However, I also recognize that we are overbought, especially when you look at the Relative Strength Index, which is well above the 70 level as we close out the month of September.
A multitude of reasons to be bullish
I believe there are a multitude of reasons to be bullish at this point, not the least of which would be just simple momentum. After all, we have seen
gold rally almost nonstop during the month of September, but it is worth noting that the market is likely to continue to see plenty of reasons to go higher. While I do believe that it is only a matter of time before the market has pulled back in order to find momentum, the reality is that we need to see a lot of value enter the market in order for people to jump in and change this market. Quite frankly, if you are chasing extreme highs, you are begging for losses.
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Looking at the fundamental reasons why this market should go higher, the first one of course is the fact that the central banks around the world continue to buy gold in general. All things being equal, this is a market that I think will be paying close attention to that, and the fact that we have a lot of geopolitical concerns around the world that could push gold prices higher as people are looking for some type of safety. Furthermore, we also have central banks around the world cutting rates, so that should continue to drive the gold price higher, as the interest rate that you get from bonds simply don't pay. Nonetheless, the biggest thing to pay attention to I think in the short term is going to be the US dollar.
The month of October will probably be fairly noisy, but if we do get a week or 2 of negativity, I suspect that we will have buyers out there looking to get involved and pick up a few ounces of“cheap gold” as it appears. I have no interest in shorting this market, and quite frankly we would have to drop about $400 for me to change my overall outlook.
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