Can the recent stabilization and rebound in gold prices continue? Institutions say “this time is different.”

Source: Global Times

[Global Times Finance Comprehensive Report] In the early hours of August 7, Eastern Eight District, international precious metals futures mostly closed lower. COMEX gold futures fell 0.15% to $4,298.70 per ounce, while COMEX silver futures dropped 0.81% to $61.78 per ounce.

Analysts say that a collective stability maintained by major global central banks, coupled with cooling US employment and eased inflation concerns, have shifted liquidity expectations to a more accommodative stance. Although this has supported gold prices, market sentiment has not entirely reversed, resulting in a slight decline amid ongoing long-short competition.

Yide Futures recently published an article mentioning that over the past two days, precious metal varieties have taken turns leading the rally. Platinum and palladium broke out first, followed by gold and silver. The entire sector has changed its downward trend seen in the past half year, making the phase shift from bearish to bullish clearly evident.

In response, Yide Futures analysis suggests that from a time perspective, gold's stabilization and rebound began with its second bottoming support in mid-July. Although the trend was turbulent during that month, price resilience has significantly strengthened: specifically, two rounds of rebound in early and late July corresponded with recovering liquidity and rising purchase orders. The mid-month conflict reignited, briefly pushing up holding costs, but the interest rate side mainly received a boost from the rise in term premium, which actually reinforced the narrative of restructuring order. Overall, gold came under limited pressure.

Looking ahead, Yide Futures believes that this gold price rebound may differ from previous ones and may exhibit certain sustainability. The main basis is that the previous core negative factors—restoration of internal and external order—have already passed key climax points in trading. On one hand, central bank gold purchase data shows that positions sold are gradually being absorbed by central banks increasing their gold purchases; on the other hand, the market's latest impression of the Federal Reserve's "dovish" stance is unlikely to change.

Yide Futures also recommends that there is no need to chase prices at current levels, and suggests buying on dips when price is pressured by repeated geopolitical factors or adverse economic data.

On the news front, according to the latest statistics from the China Gold Association, in the first half of the year, gold consumption in China reached 511.412 tons, up 1.23% year-on-year. Among this: jewelry amounted to 132.133 tons, down 33.88%; gold bars and coins totaled 339.336 tons, up 28.42%; industrial and other uses accounted for 39.943 tons, down 2.9%.

Editor: Zhu Henan