Gold Weekly Forecast: Bulls Show Interest as Fed Cut Odds Grow

Gold (XAU/USD) started the week with strong gains, driven by growing expectations for a Federal Reserve rate cut. Despite trading slowdowns due to the US Thanksgiving holiday, the metal rose more than 2% for the week. Ahead of the Fed's silent period beginning on Saturday, investors will be closely monitoring incoming US economic data.

Gold rises amid dovish Fed sentiment

Gold prices started the week higher as traders revised their expectations for a 25 basis point rate cut in December. Late last week, Fed Chairman Stephen Miran announced his support for a rate cut if his vote proved decisive. This announcement was surprising given his previous stance, when he advocated for a more significant 50 basis point cut.

New York Federal Reserve President John Williams also reiterated his commitment to easing monetary policy. He noted that current policy remains "moderately restrictive" and further adjustments are possible in the near future.

Gold Price Dynamics

Gold rose more than 1.5% on Monday and continued to rise on Tuesday, although the price ultimately remained flat. Data from ADP showed that private employers have been cutting an average of 13,500 jobs per week since November 8, which also weighed on the market.

Gold-Silver Ratio (GTS)

Interestingly, the Gold-Silver Ratio (GTS) has broken through a 14-year-old ascending support line. The nearest support is at 72. With gold at $4,500 and the GTS at 72, silver should reach at least $62. This could happen as early as next week, adding further interest to the market.

US Economic Data

New US data released on Wednesday showed 216,000 initial jobless claims were filed for the week ending November 22. This data could impact future Federal Reserve decisions and, consequently, gold prices.

In Conclusion

In conclusion, the current situation in the gold market shows growing bullish interest, driven by expectations of a Fed rate cut. Given recent statements by Fed officials and economic data, investors will be closely monitoring further market developments. Gold continues to be an attractive asset in uncertain times, and its performance in the coming weeks will depend on economic indicators and Federal Reserve decisions.