Gold has stalled after rising for the first 3 ½ months of the year, and MacNeil Curry, head of global technical strategy at Bank of America Merrill Lynch, says the precious metal is headed downward, perhaps to $1,180 an ounce.
"We've been in a medium-term downtrend since peaking out back in March at about the $1,392 area,"
Curry tells CNBC. "And price action since the beginning of April has done nothing to reverse that downtrend. All we've been doing is consolidating."
June gold futures settled at $1,305.80 Wednesday on the Comex. Gold soared 15 percent from the end of last year through March 14, but has slid 6.4 percent since then.
Editor’s Note: Retire 10 Years Earlier With These 4 Stocks
Developments in other financial markets are hurting gold, Curry maintains. "Specifically we've seen a breakout in the equity market, which suggests that investors are becoming less concerned about what's going on in Ukraine and are becoming more confident about global growth."
The dollar's recent strength also is bearish for gold, he notes.
"When you put that together with the price action, all that says that the risk-reward is for gold to resume that downtrend that began in mid-March."
Many analysts largely agree with Curry.
"The equity market continues to rise and the dollar's strength is making gold less popular," Fain Shaffer, the president of Infinity Trading in Indianapolis, tells
Bloomberg. "Some buyers, however, are picking up gold because of Ukraine."
Editor’s Note: Retire 10 Years Earlier With These 4 Stocks
© 2023 Newsmax Finance. All rights reserved.