Gold Bulls Eye $2200 in 2024 as Rate-Cut Expectations Grow: Key Levels to Watch
The final week of the year is underway and gold has maintained a positive outlook, holding above its long-term resistance price.
In the initial half of December, gold surged to a record-breaking $2,148 but experienced a partial decline due to profit booking. The latter half of the month witnessed a recovery trend.
The elevated demand for gold is attributed to growing expectations that the US Federal Reserve will initiate interest rate cuts in March 2024.
This anticipation led to a decrease in US Treasury yields. Coupled with a waning demand for the US dollar, the drop restored gold to its early December price levels.
Given the current landscape, investors anticipate that the Fed might aggressively reduce interest rates by up to 150 basis points starting in March 2024.
This reinforces the narrative that the upcoming period could be the year of commodities, sustaining the bullish outlook for gold, the commodity with the highest trading volume.
Throughout 2023, gold's safe-haven status supported prices amid escalating geopolitical risks. The ongoing conflicts in Ukraine and Gaza could spill into 2024 and fuel yellow metal's bullish outlook next year.
If we examine the spot gold chart, the upward turn from the $ 1,970 band last week ensured the continuation of the recovery that started in October.
The gold price managed to close the week above the area we follow as the long-term resistance zone in the range of $ 2,030 — $ 2,050.
If we look at the price action in the second half of 2023; After the first move above the resistance area failed in December, a more robust upward trend is noteworthy in the current situation.
If gold can end the year 2023 above the last closing peak in the $ 2,070 band, it may continue to increase
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