( Kitco News ) - It was a quiet day in the precious metal market, with prices falling lower when two of the world's largest shopping malls were closed on holidays.
The motivation is weak Monday with the New York and London markets enjoying a long weekend. However, analysts note that there is enough sentiment to continue to support prices during the slow summer months.
In low trading activity during the holiday session, June gold price last traded at 1,727.20 USD / ounce, down 0.48% on the day. Meanwhile, silver prices, which caught everyone's attention last week, last traded at $ 17,635 an ounce, down 0.33% on the day.
Some analysts have noted that gold only saw some further technical sales after prices were pushed to a new high of 7.5 years last week.
Marc Chandler, chief market strategist at Bannockburn Global Forex, noted in a report on Sunday that profit taking after reaching a high last week was not surprising when momentum indicators did not signal. a groundbreaking move.
He added that $ 1,700 was a support area he was watching because prices had held above that level since May 13.
"We still see the next important target near $ 1800," he said.
Analysts at Commerzbank said they are also tracking support at $ 1,700 an ounce. They also said it is not surprising that the gold market has leveled off after last year's multi-year highs.
"We believe that the price is simply breathing in an intact upward trend. Only if it drops below this threshold [$ 1,700 an ounce] can any prolonged correction period occur. However, this time, "the analyst said.
Analysts at the IG market said they still raised gold prices as long as prices held important support above $ 1,692 an ounce.
Although gold appears to be holding above critical support, Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said that the market needs a spark to trigger a new rally, possibly coming from the market. weak capital.
"Gold continues to stay close to $ 1725 per ounce, as investors believe that the upside potential can be unlocked by an innovative landslide on global stocks. The $ 1750 mark," she said in a note on Monday.
According to some market analysts, this will be a big week for economic data. Third, the market will see how fair consumer sentiment is in the COVID-19 pandemic.
According to some market analysts, this will be a big week for economic data. Third, the market will see how fair consumer sentiment is in the COVID-19 pandemic.
"The pace of gradual recovery, even in countries that have eased away from social policies, is consistent with our view that the United States faces a long way before any kind of normal. Now, economists at Nomura said in a report published last week.
In April, the US Council witnessed the most significant decline in consumer sentiment. Economists will be anxious to see if there has been an improvement as countries have eased some locking measures.
"Despite emotional stability, slower than expected demand recovery or the second wave of COVID-19 cases continues to present significant risks to the outlook. In addition, Cooperation back to fiscal negotiations, not being able to expand financial support by the end of this summer, could lead to a sharp decline in consumer prospects. This stresses labor market tensions will continue to exist, "Nomura analysts said.
By the end of the week, markets will get their second reading of first quarter gross domestic product data. The first reading shows that the US economy fell 4.8% in the first three months of the year, when the economy began to feel the impact of the COVID-19 pandemic.
