Spot gold prices were at $3,928.70 per ounce at the time of writing, with the bullion already notching seven weeks of continuous gains.
Gold prices surged over $3,900 per ounce to a fresh record in the early hours of Monday, as safe-haven inflows continued to rise due to the ongoing shutdown of the U.S. government, alongside persistent hopes for further rate cuts.
Spot gold prices were at $3,928.70 per ounce at the time of writing, with the bullion already notching seven weeks of continuous gains. HSBC analysts said last week that Gold could soon reach $4,000 per ounce.
However, retail sentiment on Stocktwits about SPDR Gold Shares ETF (GLD) was in the ‘neutral’ territory at the time of writing.
“$GLD while I am happy for my portfolio I can’t help but think this is signaling danger,” posted one user on the platform.
Another user speculated that GLD crashing was a question of when, not if. “RSI over 90 lol traders always overdo on either end,” he said, referring to the overbought levels.
The U.S. government shutdown entered its sixth day on Monday with Democratic and Republican lawmakers still unable to resolve their differences over key issues, including healthcare. Due to the impasse, the release of key data, including the jobs report, has been delayed. It has renewed concerns about the nation’s finances and put pressure on the dollar, prompting more investors to turn to gold as a safer bet.
On Sunday, White House National Economic Council Director Kevin Hassett told CNN’s “State of the Union” program that the Trump administration could begin mass layoffs of federal employees unless the Democrats agree to the stopgap funding measure.
Last week, analysts led by Goldman Sachs Daan Struyven said that inflows into gold-backed exchange-traded funds have been stronger than expected, suggesting investors are turning to the precious metal as a diversification play. The bank’s research arm also stated that if 1% of privately held U.S. Treasury assets were to be allocated to gold, prices could approach $5,000 per ounce.
Separately, traders continue to believe that the U.S. Federal Reserve could deliver another rate cut during the next policymaker’s meeting later this month. They have already priced in a 25-basis-point cut, as per CME Group’s FedWatch tool.
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