Spot Gold (CM:XAUUSD) prices have performed well on a year-to-date basis, rising almost 13% compared to the S&P 500’s (SPX) 9.1% rise. Still, analysts at Roth MKM believe prices can continue to climb further to the $2,500-$2,600 range from the current value of $2,341 per ounce.
Analyst JC O’Hara pointed out that although gold is technically overbought in the short term, such conditions have historically signaled bull markets. This idea is strengthened by the yellow metal’s recent break out of a multi-year consolidation pattern and its historical ability to sustain long-term bull runs, such as the period between 2005 and 2012.
Besides Roth MKM’s analysis, there are other factors that could boost gold’s price. One such catalyst could be interest rate cuts. Generally speaking, lower interest rates could spark a jump in demand, and the Fed is anticipated to cut rates three times this year. Another catalyst might be recession fears, as gold is seen as a safe-haven asset during times of financial uncertainty.
Technical Analysis of Gold
Using TipRanks’ technical analysis tool, the indicators seem to point to a positive outlook. Indeed, the summary section pictured below shows that 15 indicators are Bullish, compared to one Neutral and five Bearish indicators.
Here is a list of gold stocks that can be influenced by the latest developments in the commodities markets.
