Gold prices fluctuated on Friday as investors continued to take profits, yet the yellow metal seemed ready to resume its record-setting rally due to strong demand.
Gold weakens further on profit-taking
Spot gold fell to USD2,722.14 an ounce around 1210 GMT, down from USD2,737.82 the previous day. Silver also dropped, falling to USD33.16 an ounce from USD34.16.
According to Pepperstone analyst Ahmad Assiri, gold has experienced a sell-off from USD2,750 an ounce to USD2,710, followed by a rebound to USD2,735, highlighting the metal's enduring appeal amid volatile market conditions.
"This price movement illustrates a tug-of-war between short-term traders taking profits and persistent buying interest from investors looking to accumulate gold during dips," Assiri noted.
Recent price movements
Gold reached a new record high of approximately USD2,758 an ounce in intraday trading on Wednesday, driven by expectations of interest rate cuts, safe-haven demand due to geopolitical uncertainties, and concerns surrounding the U.S. election. The metal has surged 38% over the past year.
"While the recent decline may suggest a temporary consolidation phase, it has also shown gold's ability to quickly attract fresh bids, indicating that key buyers are entering the market with confidence," Assiri added.
"This highlights that despite short-term fluctuations, gold's value as a store of wealth remains robust," he remarked.
The next significant price movement will depend on broader macroeconomic developments, Assiri explained, adding, "If fiscal policies stay expansive and volatility continues, gold could potentially retest the USD2,750 level and move higher in the coming months."
