These trade recommendations are brought to you by CPM Group. Due to market conditions, the views and positions of trade recommendations can quickly change. We strongly advise you to monitor our published trade recommendations on an ongoing basis.
Gold traded between $1,754 / £39.98 and 1,800 / £41.03 for around two weeks until yesterday when prices topped $1,800 / £41.03. Fundamentally the upward and downward pressures on gold on a short-term basis were pretty well balanced, but has shifted to the upside over the past couple of days.
Patterns in U.S. Treasury interest rates remain the key to gold and other asset prices, which markets are struggling to guess whether rates will rise or fall. CPM’s view is that interest rates remain low and will remain low compared to historical levels. While there is some upward pressure on rates, they may remain around current levels.
Employment data April for the U.S. released today was much worse than expected, adding further upward pressure on gold prices. The ongoing pandemic, while much better contained in developed economies, is still ravaging developing countries. With gold prices up sharply within a very short time, there may be some profit taking in gold, but the upward trend is expected to continue and gold could test $1,850 / £42.17 over the next several days.
- CPM strives to try to make these Trade Recommendations as close to its own preferred trading strategies as possible. This is complicated by the gulf between our preferred method of mixing physical, futures, forwards, and options on the one hand and some distributors of these Recommendations focusing solely on spot purchases and sales. We continue to work to bring the two strategic postures into closer alignment.
- If CPM issues a Recommendation pointing to higher or lower prices over a given period of time and does not issue a subsequent new Recommendation during or after that time period, it should be taken to indicate that CPM is maintaining the buy, sell, or stand aside posture in the most recent Trade Recommendation.
Note: Discretion should be allowed at +/- 0.20% of the price at the time each TR is issued from the target. Recommendations are valid until the target date or a new Trade Recommendation or message is issued by CPM