How High Will Gold Prices Go In 2024?

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Published: Jan 10, 2024, 21:42 GMT+00:00

After an explosive run that saw Gold set new all-time highs ‘twice’ in December, prices have pulled back on routine profit-taking this month as traders bank windfall profits – ready to capitalize on the precious metals next big move.

Decoding Market Signals: Eyes on December CPI Report for Gold’s Next Move

These massive market moves have presented savvy traders with a series of highly lucrative opportunities to profit from the recent macro-driven rally as well as the huge price reversal that has subsequently followed.

Is the rally over and has all the money been made?

Not by a long shot!

Looking ahead, the major market-moving event that traders will be watching closely for clues on Gold’s next big move will be December’s U.S Consumer Price Inflation report, due for release on Thursday.

There will be a huge focus on Thursday’s data, not only because inflation has fallen much faster in the past year than many Fed officials anticipated, but also because traders have already begun pricing in bigger-than-expected rate cuts throughout 2024.

The overall CPI reading is forecast to come in at a 3.2% annual rate of growth in December. That’s slightly higher than the 3.1% growth reading in November, but significantly lower than the 6.5% reading from December 2022. This outcome will boost optimism that the Federal Reserve could start cutting interest rates as early as March.

Analyzing the Fed’s Policy Shift: Implications and Speculations for 2024’s Precious Metals Market

At the FOMC’s December meeting, Fed Chair Jerome Powell gifted Commodity traders with an early Christmas bonus – after delivering his clearest message yet, that the central bank had finished raising interest rates this cycle and will begin trimming interest rates in 2024.

Confirmation of the Fed’s long-awaited pivot sent Gold prices skyrocketing to an all-time record high of $2,152 an ounce, surpassing the precious metals previous all-time high of $2,075 an ounce that had been set only two days earlier.

The big question now is how high will Gold prices go in 2024?

Only time will tell, however one thing we do know for certain is that “the bigger the rate cut, the bigger the rally in precious metals”.

If history is anything to go by, then Gold’s record-breaking performance seen last year could just be a taster of what is yet to come in 2024. That’s welcoming news for the bulls, but painful for anyone sitting on the sidelines, who must now decide how much FOMO they can handle.