Gold Price Prediction – Prices Surge but As Buffet Joins Gold Rally

Gold prices rebounded sharply on Monday following news on Friday that Warren Buffet had taken a big stake in Barrick Gold. The dollar continued to trend lower, while US yields ran into resistance and eased throughout the trading session.

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Technical analysis

Gold prices rose nearly 2% on Monday but were unable to recapture resistance is seen near the 10-day moving average at 1,989. Target support is seen near the 50-day moving average at 1,845. Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the red with a declining trajectory which points to accelerating negative momentum.

Homebuilder Confidence Rose

Builder confidence in the newly built, the single-family home market jumped 6 points to 78 in August on the National Association of Home Builders/Wells Fargo Housing Market Index. Anything above 50 is considered positive sentiment. The index is now at the highest level in the 35-year history of the monthly series and matches the record set in December 1998. Builder sentiment plunged to 30 in April, when the coronavirus pandemic shut down the U.S. economy, but it recovered quickly as consumers suddenly sought more space in less urban areas. #gold##StockSurge##XAU/USD#

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