Gold Analysis Today 28/10: Will Record Highs Break? (Chart)

(MENAFN- Daily Forex)

• At the start of this important trading week, the price of gold fell below $2,730 per ounce, pressured by a decline in the appeal of safe-haven assets after military strikes over the weekend were less severe than anticipated.
• Financial markets are now shifting focus to key U.S. data this week, including personal consumption expenditure inflation, advance estimates of third-quarter GDP, and payroll figures.
• This could provide insights into the Federal Reserve's interest rate outlook, especially after recent strong economic data lowered expectations of aggressive rate cuts.

As is well known, low interest rates reduce the opportunity cost of holding non-interest-bearing bullion assets. However, uncertainty surrounding the US elections and other monetary easing from major central banks continues to support the gold price index.

In terms of factors affecting the gold market. The dollar is rising thanks to the rise in yields. According to the trading, the US dollar index DXY rose to around 104.5 today, Monday, heading towards its highest levels in three months and tracking a rise in Treasury yields driven by signs of a resilient US economy and bets on a Trump victory in the November 5 elections. There are also growing expectations that the Federal Reserve will adopt a more cautious approach to further rate cuts, and it is likely to opt for more moderate cuts of 25 basis points in the upcoming meetings.

Now, Investors are looking forward to more US economic data this week including JOLTs vacancies, a preliminary reading of GDP, the personal consumption expenditures price index and the purchasing managers index reports.

On the political front, market expectations indicate that Trump will regain the White House in November, pushing the US dollar and Treasury yields higher amid inflationary policies such as higher tariffs and tax cuts. According to Forex trading, the US dollar strengthened across the board, rising sharply against the Japanese yen after Japan's ruling coalition lost its parliamentary majority, further complicating the Bank of Japan's interest rate hike plans.

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On another note, according to stock trading platforms. US futures rise ahead of a week full of earnings. According to trading, US stock futures rose on Monday as investors looked ahead to the busiest week of the third-quarter earnings season, with tech giants such as Apple, Microsoft, Meta Platforms, Amazon and Alphabet set to report this week. Investors also awaited key US economic data such as preliminary GDP, personal consumption price index and purchasing managers index reports.

Moreover, easing geopolitical risks lifted market sentiment after Israel's retaliatory strikes on Iran on Saturday avoided hitting crude oil and nuclear facilities. Elsewhere, a weaker yen lifted stocks further as weekend elections in Japan resulted in a hung parliament, complicating the Bank of Japan's interest rate hike plans. Meanwhile, investors remained cautious with just a week to go before the U.S. presidential election on Nov. 5. Last week, major averages were mixed, with the Dow and S&P 500 losing 2.68% and 0.96%, respectively, while the tech-heavy Nasdaq Composite added 0.16%.

Gold Price Analysis and forecast Today:

The general trend of gold prices is still strongly bullish, and with the increase in global geopolitical tensions. Moreover, the continuation of global central banks to abandon tightening their monetary policy, bulls may remain in stronger control over the gold price trend. Currently, the closest resistance levels are $2750, $2775 and $2800 per ounce, considering that with the continued gains, all technical indicators are heading towards strong buying saturation levels. Ultimately, if the factors of gold gains calm down, prices may be exposed to strong selling operations to take profits.

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