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As the trade war between the U.S. and China escalates, all eyes are on how the economy will respond, and one expert said that gold will come out as a beneficiary.
Gary Wagner, editor of TheGoldForecast.com, said that as the U.S. prepares to enact 25% tariffs on $200 billion worth of Chinese goods, gold could rally in the long-term due to the tariff’ inflationary impacts.
“You have to look at what the tariffs will do in terms of consumer prices down the road. These tariffs are put onto the companies that are using those imports. However, they’re going to pass the additional costs back to the consumer,” Wagner told Kitco News. “So that means that the American consumer is going to be paying more, that would be inflationary, it would also set into motion the potential for a...
Published on Mar 24, 2019
Gold should benefit on the back of weakening equities, and should the next resistance level be broken, $1,374 an ounce should be the next target, this according to Gary Wagner, editor of TheGoldForecast.com. “My current target is $1,374 [an ounce] and that is based upon a Fibonacci extension of the last rally,” Wagner told Kitco News.
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Gold has a hit a “critical” area of $1,178 an ounce due to technical factors, said Gary Wagner, editor of TheGoldForecast.com.
“If it breaks below that, I think it will go to $1,124, and if it holds in this area, our next resistance point is going to be back at $1,200,” Wagner told Kitco News.
Wagner noted that gold is not yet at a bottom and its direction from this current critical level is mainly dependent on the strength of the dollar. Importantly, gold’s relationship to the dollar is most sensitive on the yellow metal’s downside.
“If the dollar begins to weaken, we will see gold recover, but it’s not going to be the other way around,” he said.
Gold has not been acting like a proper safe haven due to the fact that a full-blown trade war has not yet been triggered, but this may change once tariffs are implemented, said Gary Wagner, editor of theGoldForecast.com.
“We are in a trade dispute, we haven’t morphed into a full-blown trade war. Once tariffs are actually imposed, that will be a different story, and we might see some fireworks at that point,” Wagner told Kitco News.
Wagner noted that should gold fall below $1,240 an ounce, a level $30 lower should be expected.
Kitco News is the world’s #1 source of metals market information. Our videos feature interviews with prominent industry figures to bring you market-affecting insights, with the goal of helping people make informed investment decisions.
Gold prices spiked Friday as all eyes were on Fed chair Janet Yellen and European Central Bank president Mario Draghi’s speeches at this year’s Jackson Hole symposium in Wyoming. The metal traded in the green, last at $1,295.90 an ounce. However, one gold expert is still waiting for the metal to close above key resistance before he becomes ultra-bullish. ‘I’d feel more comfortably bullish when we have effective closes above 1300,’ Gary Wagner, editor of thegoldforecast.com, told Kitco News during Draghi’s remarks. ‘We’ve certainly tested the waters, now we simply need to see the market have the momentum to close above that. Once that happens, I absolutely believe we’re headed substantially higher.’ Commenting on the central bankers’ meeting, Wagner said he didn’t make much of Yellen’s...
Gold prices managed to move into positive territory Wednesday afternoon following the U.S. Federal Reserve's July meeting, which had a dovish tone. December gold rose $3.20 to settle at $1,282.90 an ounce. The rally comes after the metal came close to hitting the key psychological level of $1,300 last. ‘The minutes were extremely dovish...
it now seems highly unlikely we will see a rate hike this year,’ Gary Wagner, editor of The Gold Forecast, said in an interview with Kitco News. ‘The Fed minutes are more of a long-standing market mover, it is not just a flash-in-pan and we should see gold stabilize,’...
After a relatively muted summer, gold is now ending the week 2% higher. Gold was last quoted up $10.10 at $1255.40 an ounce, its highest level since June 26.
"We definitely hit a bottom last week...I still think we have higher to go," said Gary Wagner of thegoldforecast.com. '
“With the fundamental events in the marketplace now, we could see a break above $1,300 now,” he added. "A break above $1273 would signal the proper momentum to get back to this level."
However, equities in the short-term have definitely outshined the yellow metal. Since last year's Brexit vote, a portfolio with only 5% exposure in gold is up 32%, beating a 50% exposure which is up 17%, according to data analyzed by U.K.-based media outlet The Telegraph.
After rising for three straight sessions, gold came down $1.40 an ounce at $1,217.70 on Thursday. ‘Right now, we hit an intraday low this week at around $1,204 so to me there is some hope that $1,200 will hold as a support level," said Gary Wagner, editor of thegoldforecast.com. In the past three days, gold has had a higher intraday low than the previous trading session on each occasion, Wagner added. "Prices have also traded to a higher high than previous sessions, along with consecutively higher closes. However, during each of these trading days, the positive net change can be characterized as only a small upside move."
The gold market saw additional selling pressure in late-afternoon trading Wednesday, following the early release of former FBI director James Comey’s testimony scheduled for Thursday. However, to technical analyst Gary Wagner, this knee-jerk reaction is a necessary correction in gold’s overall rally. ‘We might go into period of consolidation but overall I am bullish,’ he told Kitco News. ‘Gold challenged the $1,300 mark and I still think we can take that out this year.’