On April 12th (local time), both gold and silver experienced new fluctuations, failing to sustain the earlier significant gains of the day. At one point, gold price surged by over 4%, reaching a high of $2,448.8 per ounce. The latest trading price for June gold futures is $2,355.6 per ounce, representing a 0.4% increase from the previous Friday.
Meanwhile, silver has maintained its strong performance against gold. On Friday morning, silver reached a peak of $29.905 per ounce, marking a three-year high during intraday trading. The latest trading price for May silver futures is $28.105 per ounce, a 2% increase from the previous week.
According to the CME Fed Watch Tool, the market perceives only a 27% chance of a rate cut in June, down from 50% last week and 68% a month ago. However, analysts note that while the Fed may delay the start of an easing cycle, another rate hike is unlikely. This implies that real interest rates may continue to decline, a positive environment for gold.
Despite the strong support for gold, some analysts believe that its upward momentum has become excessive. They suggest that while both gold and silver are still in robust upward trends, gold’s recent upward trajectory seems to have peaked, prompting investors to prepare for a pullback in gold prices next week.
Naeem Aslam, Chief Investment Officer at Zaye Capital Markets, stated, “I believe the momentum is still strong, but at the same time, one should not be greedy. After the astonishing surge in gold prices, we believe it is time to take some profits.”
Philip Newman, Director and Founding Partner of Metals Focus, also believes that taking profits might be a good idea for investors. He indicated that after the unprecedented record-breaking surge in the gold market, some consolidation is in order. While a significant pullback is not expected, short-term adjustments at these levels would make sense.
Christopher Vecchio, head of futures strategy and forex at Tastylive.com, highlighted that despite his favorable view of gold and silver, he does not intend to chase the market at current levels. He plans to buy on a price pullback.
