Gold Price Forecast for the week of June 7-13, 2021: bullish pressure prevails

Gold Price Forecast for the week of June 7-13, 2021: bullish pressure prevails

At first, the price of gold fell over the past week as traders focused on the idea that the Federal Reserve would cut back on its bond buying program, but after Friday’s employment data, it was clear that worries were unfounded. In this case, gold will continue to show a noticeable upward trend.

The hammer formed is an extremely bullish sign that suggests that buying interest in downturns that has been observed for some time will continue. The precious metal fell in order to test the downtrend line once again, and therefore looks promising. In the long term, the price of gold may rush to the $ 2,100 level, but the upward path will not be easy.

It is worth remembering that for the most part gold is an investment and not a subject of speculation, but the most important thing now is to monitor the position size, as fluctuations can work against you and lead to unnecessary losses.

Keep an eye on the US dollar as it gives you an idea of ​​where the gold price is heading. According to Christopher Lewis, the reversal and the prevailing bullish pressure are telling a lot about the market right now.

Despite differing views on Friday’s employment report, it still outperforms the dismal April results. According to James Hayerchik, this may be enough to limit the rise in gold this week. However, unemployment at 5.8% is still far from the Fed’s target of 5%, which is likely to support the precious metal.

There is a possibility that the report will enclose the gold price in a trading range. Meanwhile, Thursday’s CPI data could be the deciding factor, at least until the Fed announces its monetary policy decision on June 16.

This meeting is important because the Fed policymakers will be able to take into account the nonfarm payrolls report and the US consumer inflation report when making a decision.

We already know that the number of jobs implies a slow, steady recovery in the labor market, but we remain in the dark about inflation. The CPI should be close to the 0.4% estimate for the Fed to continue to argue that the surge in inflation is still temporary.

A much higher value could convince some policymakers to go against the “temporary” argument and advocate an early cut in the central bank’s program in early 2022 and a rate hike in 2024.

Thus, the decisions of traders and investors in gold this week are likely to depend on the CPI and its impact on Fed policy.

Posted by Christopher Lewis & James Hayerchik June 4, 2021 | Translation: Gold Reserve

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