It's been a tough start to the second half of the year for gold but a fall in Treasury yields and hints that the Fed might not tighten as much as feared have lent a bid. It's up $21 to $1754 after a similar gain yesterday after the FOMC.
So far it's tough to call this anything other than a dead-cat bounce after the plunge from $2050 in March. It would need to get above $1786 to get any momentum. That said, it bottomed where it needed to, holding the Q1 2021 lows so there's now a well-defined range between $2050 and $1680.
What's I've noticed so far in earnings in Q2 is tremendous inflationary pressures on miners because energy is such a large input. That strengthens my conviction that we will have a material spike in copper in the years ahead and other base metals but it could also apply to gold in time.
Given the strength in the US dollar this year, the decline in gold isn't as bad as looks. If it can finish the year above $1800 that would mean a positive year (in some cases strongly) against nearly every currency.
