"In my view, this phase is not merely a temporary technical hesitation, but rather a deep confrontation between two opposing forces: growing expectations of monetary easing versus the resilience of U.S. economic data and rising real yields. This fragile balance places gold in a state of "strategic waiting," where any breakout or pullback will require a strong fundamental catalyst rather than short-lived speculative momentum."
"I believe the most influential factor at this stage is the monetary policy outlook of the Federal Reserve, as the trajectory of interest rates has become the decisive element in determining gold's attractiveness. Historically, gold benefits from a low-interest-rate environment because it is a non-yielding asset, meaning the opportunity cost of holding it declines. With expectations increasing that the Fed may shift toward policy easing later this year, this scenario, in my opinion, provides a solid support base for gold-even if short-term volatility persists."
Gold's price action is hovering near pivotal resistance at 5100, with key support at 4921–4917.52. Markets have yet to determine a definitive direction. The current phase reflects a confrontation between growing expectations of monetary easing and the resilience of U.S. economic data with rising real yields. Gold remains in a state of strategic waiting, where breakouts or pullbacks will require strong fundamental catalysts rather than short-lived speculative momentum. The Federal Reserve's monetary policy outlook and the trajectory of real yields are the decisive factors shaping gold's near-term attractiveness and risk.
Read at London Business News | Londonlovesbusiness.com
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