Voters in the weekly Kitco gold survey remain bullish on the metal, with Wall Street analysts continuing to cite expected safe-haven buying of the precious metal due to worries about the impact of the coronavirus on the global economy.

The stock market posted several rallies last week – and gold dipped – as investors at times shook off worries about the damage to the global economy from the coronavirus. Yet the issue hasn't gone away, with the World Health Organization now putting the death total in mainland China at 637, with more than 31,000 total cases.

"The virus impact cannot be ignored," said Ole Hansen, head of commodity strategy at Saxo Bank, who described himself as bullish on gold. He suggested that the full impact of any ensuing economic slowdown in China and abroad is not being fully priced into markets.

Twelve market professionals took part in the Wall Street survey. Eight, or 67%, called for gold to rise. There was one vote, or 8%, saying gold would fall, and three, or 25%, calling for a sideways market.

Meanwhile, 966 votes were cast in an online Main Street poll. A total of 570 voters, or 60%, looked for gold to rise in this week. Another 232, or 24%, said lower, while 164, or 17%, were neutral.

"It looks like it eventually wants to go up to the [recent] highs," said Daniel Pavilonis, senior commodities broker with RJO Futures. "If this coronavirus continues to become more and more of a [worrisome] situation, gold will continue to be bought up."

Phil Flynn, senior market analyst with at Price Futures Group, looks for gold to bounce after recently falling to the lower end of its trading range. The price slid earlier last week on hopes that the coronavirus might be contained quickly. But the most recent news reports overnight suggest that this might not be the case, he continued.

"That should keep people using gold as a safe haven," Flynn said.

Phillip Streible, chief market strategist with Blue Line Futures, said "I'm optimistic" on gold not only due to the coronavirus but a rise in the U.S. jobless rate. Nonfarm payrolls rose 225,000 last month, but the unemployment rate ticked up to 3.6% from 3.5% as more people entered the job market searching for work.

Charlie Nedoss, senior market strategist with LaSalle Futures Group, added that market participants appear to be paying attention to the downward revisions in the jobs data. While nonfarm payrolls rose sharply last month, the tally for 2019 was revised downward by around one-half million.

"I think we found support around $1,560," Nedoss said. "I'm not looking for a huge rally, but I’m looking for a little bit of strength next week."

Jim Wyckoff, senior technical analyst with Kitco, also said higher.

"The gold market has shown keen resilience recently in the face of a rallying competing asset class – equities," he said.

John Weyer, co-director of commercial hedging with Walsh Trading, was among those who see a sideways market.

"We had what looked to be good jobs numbers," Weyer said. “Normally, that's bearish for gold… but we still have this coronavirus stuff hanging over our heads, so you'll see a flight to quality there. On any other good economic news, you'll see [gold] down, so [gold will move] back and forth and I’m looking for sideways."

Source: Kitco News