The Battle for Gold

The Battle for Gold, as 2020 draws to a close, it’s been an extremely difficult year for many people.

 

Topics
A Tough Year Ends
From Rock Bottom to Rallying Gold
200-day moving average

 

 

 

 

 

 

A Tough Year Ends

 

As 2020 draws to a close, it’s been an extremely difficult year for many people.

The pandemic has caused disruption and hardship to countless individuals and businesses across the globe.

But despite all of this, there is one asset class that has held up rather well: precious metals. 

 

Investors have turned to gold as a haven during times of economic uncertainty,
with the price reaching its highest level since 2012 in August 2020 at $2159 per ounce.

Silver also saw strong gains over this year; prices rose
from around $16 per ounce in January to almost double that amount by November – peaking at just above $30 an ounce! 

 

In addition to their traditional roles as safe havens during turbulent times,
precious metals are increasingly being seen as attractive long-term investments due to their limited supply relative demand growth potential – making them ideal for portfolio diversification strategies too!
This was especially true in 2020 when stocks experienced significant volatility due largely (but not exclusively) COVID-19-related news flow – resulting in investors turning towards alternative assets such as gold and silver instead.

  

 Precious metal ETFs have also grown significantly over this period; both physically backed funds such as US Global GO GOLD & Precious Metal Miners ETF (GOAU) or iShares Gold Trust (IAU),
along with leveraged products like ProShares Ultra Silver ETF (AGQ).

These provide exposure without having direct ownership
which can be beneficial depending on your individual needs/goals etc…

 

Overall then it’s clear that although we might be ending what has undoubtedly been a very tough 12 months
for most people globally – ultimately our trusty old friend ‘precious metal’ hasn’t let us down once again
proving itself resilient even against some heavy odds!

 

 

From Rock Bottom to Rallying Gold

 

The gold market has been on a wild ride over the past few weeks,
with prices swinging from highs to lows and back again. After hitting its triple bottom of 1,615 USD on August 13th,
gold staged a strong recovery rally that gained momentum over the last four weeks.

 

This advance was characterized by choppy price action
as investors tried to make sense of conflicting economic signals in both the US and global economies. 

On one hand, there have been signs of improvement in certain sectors such as housing starts which could point towards an eventual rebound in growth; while at the same time there is still considerable uncertainty around how long it will take for economic activity to return to pre-pandemic levels. As such investors have become more risk-averse and sought out safe-haven assets like gold for protection against potential volatility or downturns ahead.

 

This shift towards safer investments helped push up demand for physical bullion leading into September’s FOMC meeting where Chairman Powell announced additional monetary stimulus measures including an extension of near-zero interest rates until 2023 – further boosting investor confidence in precious metals markets overall.  

 At current levels (1,934 USD), many analysts are predicting that this upward trend may continue well into 2021 given no major disruptions from either fiscal or monetary policies worldwide – making now an ideal opportunity for those looking to add some sparkle to their portfolio with exposure through ETFs or futures contracts!

 

 

 

 

 

 

200-day moving average

 

As investors and traders, it’s important to stay up-to-date on the latest market trends. Recently, prices have been oscillating around the 200-day moving average and running into a bearish wedge at the same time. This is an interesting development that could mean big things for investors in both short-term and long-term investments. 

So, what does this mean? Well, when prices are oscillating around a certain value like they are currently with the 200-day moving average then it means there is some uncertainty in terms of which direction they will go next – whether up or down. Generally speaking, if price action stays within these boundaries, then we can expect more sideways movement rather than any major trend changes occurring anytime soon as buyers and sellers battle for control over pricing levels. 

The other aspect of this situation worth noting is that prices have also run into a bearish wedge pattern at the same time as hovering near their 200-day MA level; meaning that there may be an impending downtrend ahead if current conditions persist over time (bearish wedges usually indicate such). Investors should therefore pay close attention to how price action develops from here on out so as not to get caught off guard by any sudden shifts in momentum or directionality due to changing investor sentiment towards particular assets or markets overall.

 

 

 

 

 

Glittering Possibilities of Gold

Glittering Possibilities of Gold, As the world economy continues to face uncertainty,
investors are looking for safe-havens that can provide them with stability and growth.

 

 

Topics
Golden Opportunity
The Power of Gold
How Gold Can Protect Portfolio?

 

 

 

 

Golden Opportunity

 

Gold has been one of those assets since ancient times, and its value is expected to continue rising in the coming years.
According to financial experts, gold could reach prices of up $3-4k per ounce by 2023!

This prediction is based on a few factors: increased demand from central banks around the world
as they look for more reliable investments; an increase in industrial uses such as electronics manufacturing;
and a weakened US dollar due to economic uncertainties like Brexit or trade wars.

All these together create an environment where gold will be increasingly sought after,
driving up its price even further! But what does this mean for you?
Well, if you’re already invested in gold then congratulations –
your investment should pay off handsomely over time!
But if not there’s still plenty of opportunity here too,
now might be just the right time to buy some before it gets too expensive later down the line!

With careful planning and research into which type of investment suits your needs best (e.g. stocks vs physical bullion),
you’ll be well placed when it comes time to cash out at higher prices down the road.
So why wait any longer? Start investing today so that come 2023 you can reap all rewards
that come with owning precious metals like gold – make sure don’t miss out on this golden opportunity!

Central banks around the world have been on a gold-buying spree,
and it’s no wonder why. Gold has long been seen as a safe-haven asset,
an investment that can weather economic storms as few other assets can.
As global economies continue to struggle with low growth
and uncertainty surrounding trade wars and geopolitical tensions,
central bankers are looking to gold as an anchor in turbulent times.

 

 

 

 

 

The Power of Gold

 

The surge in demand for gold from central banks is particularly notable given
that this was largely unexpected at the start of 2019 when prices were much lower than they are now.
According to data from the World Gold Council (WGC),
official sector purchases rose by 74% year-on-year during Q3 2019 – reaching their highest level since 1967!

This increase was driven primarily by countries such as Russia, China, Kazakhstan,
and Turkey who all increased their holdings significantly over this period.

So, what does all this mean? Well for starters it means that
these governments see value in holding physical gold reserves rather
than relying solely on paper money which can be subject
to inflationary pressures or currency devaluation due to political unrest
or economic instability elsewhere in the world economy,
making investments in precious metals attractive even more so today than ever.

Furthermore, investors should take note of how large institutions view bullion investments
because if they’re willing to put such significant amounts into something
then there must be some underlying confidence behind its potential returns going forward too,
especially considering current market conditions
where many stocks & bonds may not offer enough protection against volatility.

As investors and economists alike try to anticipate the next recession,
it’s important to keep an eye on the risk of over-tightening.

If the Federal Reserve tightens too much, it could lead to a sharp decline
in economic activity and put us into a recession.

If we look back at history, there is evidence that suggests that
when interest rates are too high for too long (over-tightening),
this can cause recessions. For example, during periods when inflation
was running hot in the 1970s and 1980s – such as 1979–1982 –
interest rate hikes by central banks around the world.

 

 

How Gold Can Protect Portfolio?

 

In today’s environment with low inflation but rising debt levels,
particularly government debt – any rise in borrowing costs could be catastrophic if not managed correctly by central banks like The Fed or Bank of England etc… This is why many analysts have argued for more accommodative policies from these major players so as not to give them any excuse for tightening prematurely which would only exacerbate current conditions further leading us towards another potential global financial crisis type situation similar 2008/09…

 

Gold has historically been seen as a safe-haven asset class when markets become volatile or uncertain due to its lack of correlation with other asset classes like stocks & bonds making it an attractive option for investors looking to protect their portfolios against downturns. It also acts hedge against currency devaluation & deflationary forces both of which may result in increased money supply created through quantitative easing measures taken by Central Banks to attempt to stimulate economies…

 

So overall conclusion here appears clear; while some argue increasing rates is necessary to combat future inflationary pressures, it’s essential to balance between keeping the economy healthy without risking a tipping point into full-blown recession something must be monitored carefully to prevent avoidable mistakes being made going forward…

 

 

 

 

A Delicate Balance or A Golden Opportunity

A Delicate Balance or A Golden Opportunity, Gold prices traded in a narrow range on Tuesday as investors held back from making large bets ahead of U.S. inflation data and the Federal Reserve’s rate-hike decision.

 

Topic
Navigating the Uncharted Waters of Gold Invest
Gold Shining Brighter
Gold & Silver in the Face of Unclarity
Reaping the Rewards of Rate Hikes

 

 

 

 

 

 

 

With uncertainty surrounding both events, it is no surprise that gold traders are
taking a wait-and-see approach to their investments currently.
The upcoming release of U.S. inflation data could have an impact on the Fed’s decisions regarding future interest rates,
which in turn could affect gold prices significantly depending on
how they decide to proceed with policy changes or not make any at all! Additionally,
if there is evidence that consumer spending has increased
due to higher wages then this would likely result in further monetary tightening by the central bank
something investors should be aware of when considering whether now is an opportune moment for investing in Gold or not.

 

In light of these factors, it may be prudent for investors who are looking into buying Gold right now

to take cautionary steps such as diversifying their portfolio across different asset classes
and monitoring market developments closely over the next few days
before making any major moves with regard to investing money into precious metals like Gold!
By doing so they can ensure that whatever direction markets move towards
after US Inflation Data & The Feds Rate Hike Decision come out
they will still have some protection against potential losses incurred
due to volatile price swings within this sector specifically during times when uncertainty reigns supreme!

 

 

Gold Shining Brighter

 

Investors, it’s time to take notice of the gold market. Spot gold was up 0.1% at $1,783.16 per ounce
by 1011 GMT and U.S. gold futures edged 0.1% higher to $1793-90
a sign that investors are looking for safe havens in times of economic uncertainty
and volatility in other markets such as stocks or cryptocurrencies like Bitcoin.

 

The dollar index was down 0/1%, making greenback-priced bullion more appealing to buyers holding other currencies
further evidence that investors recognize the value of investing in precious metals
when there is uncertainty around traditional investments.

Gold has long been seen as an important part of any diversified
portfolio because it can act as a hedge against inflation,
currency devaluation and global political instability
all factors which could affect your returns from traditional investments such as stocks or bonds,
Investing in physical assets like gold can also provide you with greater control
over your investment decisions compared with trading on exchanges
where prices may be influenced by external events outside your control.

 

So, if you’re looking for ways to protect your wealth during this period of volatility
then now could be an ideal time for adding some physical Gold to your portfolio!

The recent announcement of a 50-basis point rate increase by major central banks has been priced in, leaving investors wondering what the next directional movement for gold and silver will be. With so much uncertainty swirling around global markets, it’s no wonder that many investors are looking to precious metals as a safe haven asset.
However, before we can see any new directional movement for gold and silver prices, more clarity is needed from central banks on their monetary policy decisions going forward.

 

 

 

 

Gold & Silver in the Face of Unclarity

 

As the effects of this latest rate hike work their way through financial markets over time—including potential impacts on currency values—the true direction of these commodities may become clearer in due course.

 

In the meantime, there are other factors that could help drive up demand for both gold and silver even without further action from central banks: geopolitical tensions remain high across several regions; inflationary pressures continue to build worldwide, and economic growth remains sluggish in some countries despite recent stimulus measures taken by governments or international institutions like the IMF or World Bank.

 

All these elements have contributed to an environment where precious metal investments might make sense right now as part of a diversified portfolio strategy – though always with caution when investing!

Ultimately then while we wait patiently (or impatiently!) for more guidance from our respective banking systems regarding interest rates etc., it’s essential not to forget all those other external influences which could still affect movements within commodity markets such as Gold & Silver too – they should never be overlooked!

 

“Before we can see any new directional movement for gold and silver, we need some more clarity from central banks. For the time being, the aspect of 50 basis point rate increase from all the major banks are already been priced in,” Carlo Alberto De Casa, an external analyst at Kinesis Money, said.
“I see good chances of a consolidation phase. I don’t expect massive movements in the final part of the year,” he added.

 

Investors, the time is now! The U.S. central bank is set to issue its policy statement at 2 p.m. EST (1900 GMT) on Wednesday, followed by a press conference from Fed Chair Jerome Powell at 1930 GMT – and traders see an 89% chance of a 50-basis-point rate hike!

 

 

Reaping the Rewards of Rate Hikes

 

This news comes alongside similar expected action from both the Bank of England and European Central Bank this week as each is also predicted to deliver a 50-bps rate hike. This means that investors have plenty of opportunity for growth in their portfolios over the coming weeks should they choose to capitalize on these changes in monetary policy across all three major economies.

 

It’s important for investors to keep a close watch over inflationary data though as any weak print could mean that rates will remain restrictive for shorter than initially anticipated periods

 

so it pays off big time if you’re paying attention here too! ANZ has already noted this in their latest report, making it even more crucial that you stay up to date with what’s happening around you when considering your next investment move or strategy shift accordingly.
In conclusion, make sure not to miss out on these huge opportunities presented by upcoming changes in central bank policies – act fast before someone else does first!

 

 

 

Gold Price Forecast

Gold Price Forecast, Gold prices remained positive traction on Tuesday and reversed a part of the previous day’s retracement slide from a five-month peak.

 

 

Topics
Gold prices rebound on Tuesday
What’s Next for the Markets
Gold Soar as Fears strikes the world

 

 

 

 

 

 

Gold prices rebound on Tuesday

 

The steady intraday ascent extended through the early North American session
and lifted the XAU/USD to a fresh daily high, around the $1,780-$1,781 region in the last hour.
The renewed buying interest coincided with some weakness in the US Dollar Index ahead of today’s FOMC meeting minutes release.
This, along with an uptick in global risk sentiment helped offset concerns
over surging coronavirus cases across Europe and the lack of progress on additional US stimulus measures.

With no major market-moving economic releases scheduled for Tuesday afternoon from either side of the Atlantic Ocean,
Gold prices are likely to remain influenced by developments surrounding
the COVID-19 pandemic as well as broader market risk sentiment trends
before traders start positioning for this week’s key events
especially Friday’s monthly jobs report from the US economy.

 

Gold prices are on the rise as the US Dollar continues to weaken.
This is good news for investors who have been watching the Gold market closely.
The weaker US Dollar lends support to Gold price, making it a more attractive investment.
With interest rates expected to remain low, Gold is likely to continue its upward trend.
So if you’re looking for a safe haven for your investment portfolio, consider adding some Gold to your holdings.

 

The US economy continues to defy expectations with strong job growth
and resilient economic activity. The latest ISM Services PMI came in better than expected,
pointing to a healthy economy. This raises fears that the Federal Reserve might lift rates more than projected.
However, investors seem convinced that the Fed will slow the pace of its policy tightening cycle
and only anticipate a 50 bps rate hike in December.
This positive outlook is good news for investors looking to put their money into US assets.

 

 

What’s Next for the Markets

 

While the FOMC meeting is the key event next week, there are other data releases
and events that could also move markets.

Here’s a look at some of the key risks:

US consumer inflation figures for November:
These numbers could influence the Fed’s policy outlook and, in turn, gold prices.
The latest US retail sales figures:
These numbers will be closely watched to see how consumers are spending heading into the holiday season.
Any weakness could spook investors.
Earnings reports from major retailers:
Retailers’ earnings reports will give insight into how they’re faring this holiday season.

 

Strong results could boost confidence in the sector, while weak results could weigh on stocks.

The economic data from China over the past few weeks have been encouraging,
with manufacturing activity and retail sales both picking up.

However, global equity markets have failed to sustain the initial optimism led by these data releases,
as concerns about a deeper economic downturn continue to weigh on investor sentiment.

 

 

Gold Soar as Fears strikes the world

 

One of the key drivers of this pessimism is the increasing likelihood of a recession in the United States.
The latest data from jobless claims and consumer confidence surveys point to an economy
that is struggling to cope with the impact of COVID-19.
With businesses across sectors cutting jobs and consumers tightening their spending,
it seems only a matter of time before we see a full-blown recession in America.

 

This growing fear of an American recession is one of the main reasons why Gold prices have remained elevated in recent weeks.
As a safe haven asset, Gold benefits from increased demand when investors are seeking refuge from market volatility
and economic uncertainty.
We expect this trend to continue in the near term as fears about a deepening global downturn continue to underpin demand for Gold.

The bullish bias prompt some technical selling.
This, in turn, could drag the commodity back towards the key $1,750 – $1,747
horizontal-line-support-turned-resistance zone.
Some follow-through weakness below might even take it towards an important Fibonacci retracement level
of $1,737 before the Gold price eventually stabilizes around the mid-$1700s.

 

 

Gold: The Road to Recovery

Gold: The Road to Recovery, Gold prices have staged a modest recovery in recent trade,
retaking the $1750 per ounce level amid broad-based selling pressure in the US Dollar.

 

Topics
The Gold Rush
Rising US Treasury Bond Effect
Gold price technical outlook

 

 

 

 

 

 

The Gold Rush

 

The move comes as market participants brace for what is shaping up to be a critical day of trading
on Tuesday, with renewed optimism from China helping to support risk flows.
With safe-haven demand easing and the USD under pressure,
gold prices appear poised to continue their upward march in the near term.
However, any further gains may be limited by resistance around the $1760 level.
|For now, all eyes remain on developments in China and how they will impact global markets tomorrow.
The US Dollar has come under pressure as optimism grows in China that the country will soon be able to relax its zero-Covid policy.

After three days of lockdown-induced protests, Chinese equity markets have rebounded strongly on the expectation that the government will soon ease its restrictions. Global Times tweets have suggested that the government could do away with its stringent zero-Covid policy sooner than later, lifting risk sentiment and putting pressure on the US Dollar.
The S&P500 futures are up 0.36% so far today, reflecting the positive shift in market sentiment. With China moving closer to reopening its economy, investors are becoming increasingly optimistic about global growth prospects, and this is weighing on the safe haven US Dollar.

It’s worth noting that China on Tuesday reported a decline in new COVID-19 infections for Nov. 28, posting 38,645 cases, after a record daily high of 40,347 cases on the previous day. Reduced safe-haven demand for the US Dollar bodes well for the USD-sensitive gold price.\

 

 

 

 

Rising US Treasury Bond Effect

 

The US Treasury bond yields recovered sharply on Monday after the hawkish commentary from the United States Federal Reserve officials. The further recovery in Gold price could be capped by the buoyant tone seen around the US Treasury bond yields.
James Bullard, President of the Federal Reserve Bank of St. Louis, said that rates need to go higher to bring inflation down. New York Fed Bank President John Williams said that “I do think we’re going to need to keep the restrictive policy in place for some time; I would expect that to continue through at least next year.” Meanwhile, Richmond Fed President Thomas Barkin noted that “I’m very supportive of the path that is slower, probably longer and potentially higher.”

The Bullish remarks from the US Treasury officials lifted the bond yields and fuelled a solid comeback in the US Dollar. Gold price, therefore, closed Monday deep in the red near the $1,740 demand area. The move was in line with our previous forecast and now we expect further downside pressure on gold prices in the short term.

 

 

Gold price technical outlook

 

Gold prices failed to resist above $1,747 on Monday, which is the 23.6% Fibonacci Retracement (Fibo) level of the latest rally from the November 3 bottom at $1,617. The move lower also prompted gold price to settle the day below the rising (dashed) trendline support, then at $1,744.

Buyers found support once again near the $1,740 region though, triggering a recovery rally above the $1,750 level this Tuesday morning. In doing so gold price has recaptured both the 23.6% Fibo level and the rising trendline support-turned-resistance now at $1747 and$1749 respectively the next upside barrier is seen around the key figure mark at $1,760 Acceptance above the latter will be critically unleashing any additional upside toward $1,770

The 14-day Relative Strength Index (RSI) looks poised for further gains after already inching higher from just above the midline This combined with today’s early morning breakout above short-term resistance suggests we could see some more upside in gold prices over coming sessions However any retreat below minor support around $1,740 would negate the immediate bullish outlook.

 

 

 

Gold Rises as Dollar Falls

Gold Rises as Dollar Falls, Gold prices rose on Tuesday, snapping a four-session slump, as the dollar retreated and investors awaited cues on the U.S.

 

Topic
Federal Reserve’s monetary policy path
The Fed’s Last-Minute Rate Hike
The U.S. nonfarm effect

 

 

 

 

 

 

Federal Reserve’s monetary policy path

 

The Fed is widely expected to leave interest rates unchanged at its two-day meeting that ends on Wednesday,
but traders will be looking for clues on the central bank’s plans for future rate hikes.
A weaker dollar makes gold cheaper for holders of other currencies,
while higher rates could dent demand for non-yielding bullion.
Spot gold was up 0.3% at $1,281 an ounce by 1007 GMT after falling
to a more than one-week low of $1,274 in the previous session when it dropped
below key technical support around its 200-day moving average.
Gold fell nearly 2% last week in its biggest weekly percentage drop since early July 2016

Spot gold was up 0.6% at $1,747.82 per ounce on Thursday morning as the US dollar stalled its rebound,
offering the precious metal a chance to find firmer footing around the mid-$1700 region.
US gold futures rose 0.5% to $1,748.90 as traders await further direction
from key technical levels and fresh fundamental catalysts.
“The US dollar’s stalling rebound is offering spot gold the chance to find a firmer footing
around the mid-$1700 region for the time being,”
said Han Tan, chief market analyst at Exinity, from a technical perspective.
However, bulls need to overcome resistance at $1750 in order for prices
to target a move back towards last week’s highs of $1775.

 

 

The Fed’s Last-Minute Rate Hike

 

The government made a wise decision by making gold less expensive for foreign buyers.
The dollar has recently risen in value versus all major currencies.
This has increased the cost of gold for international buyers, perhaps leading to reduced demand and prices.
The government hopes to boost demand and keep prices constant by making gold more affordable to foreign purchasers.

The minutes from the last Federal Reserve meeting are due out tomorrow,
and traders and investors are eagerly awaiting them.
There is wide expectation that the Fed will announce a 50-basis point rate hike in December,
with rates peaking in June. This would be a major shift from the recent narrative of a “pivot” by the Fed,
which has been seen as bullish for gold prices.
If the Fed does indeed hawks swoop back in and disrupt this narrative once more,
it could see gold prices unwinding some of their recent gains and testing support around $1700 an ounce.

The U.S. nonfarm payrolls and inflation prints due before the December Fed meeting are likelier catalysts for bullion’s next big moves. Gold prices have been on a tear lately, hitting new all-time highs in multiple currencies. The precious metal is up more than 25% this year as investors seek safe havens amid the Covid-19 pandemic and economic uncertainty.

While gold could continue to rise in the near term, some analysts believe it could be ripe for a pullback after such a strong run-up. That said, key data releases from the U.S., including nonfarm payrolls and inflation numbers, could provide direction for gold prices in the lead-up to the Federal Reserve’s December meeting.

 

 

 

 

 

The U.S. nonfarm effect

 

A better-than-expected jobs report could ease concerns about an economic slowdown and put pressure on gold prices as risk appetite improves. On the other hand, if inflation comes in higher than expected, it could add fuel to fears of stagflation and send gold prices even higher

“The U.S. nonfarm payrolls and inflation prints due before the December Fed meeting are likelier catalysts for bullion’s next big moves.” Said Tan

With interest rates on the rise, many traders and investors are wondering what this means for gold. While higher interest rates tend to be negative for gold prices, there are a few things to keep in mind. First, the Fed has said that they will be gradual in their rate hikes. Second, inflation is still relatively low. And finally, while gold doesn’t offer any yield itself, it can still act as a hedge against inflationary pressures. So while higher interest rates may not be great news for gold prices in the short-term, longer-term prospects remain positive.

Spot silver climbed 2.1% to $21.28 per ounce on Wednesday, extending its gains for the third straight session. The white metal was boosted by safe-haven demand as investors sought refuge from volatile equity markets. Platinum added 1.1% to $993.29, and palladium gained 0.6% to $1,876.

 

 

 

Gold prices take a tumble

Gold prices take a tumble, and gold prices have been volatile lately, falling on Thursday after better-than-expected
U.S. retail sales data increased the likelihood of a rate hike by the Federal Reserve.

 

Topics
Gold’s Run Finally Comes to an End
Rising Interest Rates on Gold
The Impact of the Ukraine Crisis on Gold

 

 

 

 

 

 

 

Gold’s Run Finally Comes to an End

 

The strong dollar weighed down gold prices,
while safe-haven demand from geopolitical concerns also faded.
Despite the recent decline, gold prices are still up significantly from where they were a year ago.
This is due to a variety of factors including central bank buying, global economic uncertainty,
and safe-haven demand. Gold is often seen as a hedge against inflation and currency debasement,
making it an attractive investment during times of uncertainty.

Looking ahead, it remains to be seen how long gold’s rally will last.
If the Fed raises rates more aggressively than expected or if geopolitical tensions ease, gold prices could come under pressure once again.
However, given the current environment of low-interest rates and high economic uncertainty around the world,
gold could continue to shine in the months and years ahead.

Gold has had an excellent run over the past few months, but it has finally succumbed to the strength of the dollar.
The dollar has been on a tear lately, rising against all of its major rivals.
This makes gold more expensive for other currency holders and is likely to lead to some profit-taking by investors.
However, given the magnitude of gold’s prior rally, it could still pull back further before finding support.

 

 

 

 

 

Rising Interest Rates on Gold

 

“Gold has had an excellent run, but having struggled to push above $1,790 it has succumbed to the strength of an oversold U.S. dollar and seemingly entered a retracement”,
“Gold can pull back further given the magnitude of its prior rally,
which is likely to tempt profit-taking and entice a few countertrend bears around these highs,” said City Index analyst Matt Simpson.

U.S. retail sales increased more than expected in October, suggesting that consumer spending could help to underpin the economy in the fourth quarter
and renewed expectations that the Federal Reserve will keep hiking rates.

San Francisco Fed President Mary Daly told CNBC it’s reasonable for the Fed to raise its policy rate to a 4.75%-5.25% range by early next year,
and that pausing rate hike is not part of the discussion.

 

 

 

 

When it comes to investing in precious metals like gold and silver, many people are concerned about rising interest rates.
After all, if rates go up, that means there are more attractive investment options available that offer a higher return.
So why would anyone still want to invest in gold?

The answer lies in the fact that gold is a hedge against inflation. When prices start to rise rapidly, the value of gold goes up as well.
This makes it an ideal investment for those who are worried about inflation eating away at their savings.
Additionally, while bullion may not pay any interest itself, it can be used as collateral for loans that do offer a return on investment.

So don’t let rising interest rates deter you from investing in precious metals! Gold and silver can still be great additions to your portfolio.

 

 

The Impact of the Ukraine Crisis on Gold

 

Gold prices have surged to a three-month high as fears of an escalation in the Ukraine crisis grow.
Media reports of a Russian missile strike that killed two people in Poland near the Ukraine border have sparked concerns that the conflict could escalate further.
Poland’s president said on Wednesday a missile that hit his country was probably a stray Ukrainian defense projectile, dispelling fears that it came from Russia

With tensions running high between Russia and the West, it’s no wonder that people are on edge about the possibility of a stray missile hitting Poland.
Thankfully, it seems that this was not the case and we can all breathe a little easier.

Precious metals were mostly lower today as investors took some profits off the table after recent gains.
Silver was hit particularly hard, falling more than 1%. Platinum and palladium also fell modestly while gold held steady.

Overall, it was a relatively calm day in markets despite the potential for drama.
We’ll be keeping an eye on developments in Eastern Europe closely to see if anything else pops up.

 

 

 

 

US: Get ready for the big fall

US: Get ready for the big fall, The year ahead will mostly feature falling market rates, as the Fed peaks out and the market anticipates future rate cuts.

 

Topics
The Impact of Inflation and Jobless Claims
Indices heavy losses
The policy of the Federal Reserve
Overall Volatility

 

 

 

 

The Impact of Inflation and Jobless Claims

 

The curve should dis-invert through the year, and ultimately will steepen out from the front end.
The fall in rates will come from the back end first,
but should later be dominated by falls in front-end rates in the second half.
This is good news for investors and traders who are looking to take advantage of lower interest rates.
U.S. stocks are seen opening higher Thursday,
with the Dow Futures contract up 60 points, or 0.2%, at 07:00 ET (12:00 GMT).
The move comes after sharp losses in the previous session,
as investors await key inflation data and more midterm election results.
Investors are cautious ahead of the release of inflation data for October, which is due out later in the day.
The report is expected to show that consumer prices rose 0.3% last month, after climbing 0.2% in September.
The rise in prices is being driven by increases in costs for housing and healthcare.
However, some analysts believe that the overall trend remains one of the moderate inflationary pressures.

 

 

 

 

 

Indices heavy losses

 

The main stock indices in the US closed with heavy losses on Wednesday
as the outcome of the midterm elections remained unclear.
Although it seemed likely that Republicans would take control of the House,
this did not stop investors from selling off their stocks.
The blue-chip Dow Jones Industrial Average fell over 600 points or 2%,
while the broad-based S&P 500 dropped 2.1%.
The tech-heavy Nasdaq Composite was not spared either, closing 2.5% lower.

Investors were clearly worried about what a Republican-controlled House could mean for future policymaking,
particularly with regard to taxes and regulations.
However, it is worth noting that even if the Democrats had won control of both chambers of Congress,
gridlock would have still been a very real possibility given how divided our politics are right now.

 

 

 

 

The policy of the Federal Reserve

 

Inflation data for the United States will be released later this week
and traders are eagerly awaiting the release to see if it provides any clues as to the future monetary policy of the Federal Reserve.

Investors have been worried that the Fed may raise interest rates too quickly in response to inflationary pressures,
which could lead to a sharp slowdown in economic growth.
However, recent comments from Fed officials suggest that they are aware of these concerns and are likely to proceed with caution.

The most important thing for investors to watch in this data release is not just the headline number for inflation,
but also the “core” rate which excludes volatile items like food and energy prices.
If core inflation is rising at a faster pace than overall inflation,
then it suggests that there is more underlying pressure on prices.

 

 

Overall Volatility

 

Away from politics, this week’s inflation data will give us a better idea of how fast interest rates are likely to rise over the coming months. With markets still digesting last week’s surprise announcement by President Trump that he intends to nominate Jerome Powell as the next Chairman of The Federal Reserve,
there is plenty of uncertainty surrounding monetary policy at present.
A clear signal from Thursday’s data would be very welcome indeed.

The cryptocurrency market is in turmoil, with the decision of Binance to back out of the rescue of smaller crypto exchange FTX leaving the latter on the brink of collapse.

This has created a degree of uncertainty among investors and traders.
However, there are still some quarterly earnings to digest,
with fashion retailers Tapestry and Ralph Lauren,
as well as Aurora Cannabis due to report today.
Oil prices have also retreated on concerns for demand growth from China as cases surge and U.S. crude oil inventories rise.
U.S. crude oil stockpiles unexpectedly rose last week,
according to data from the Energy Information Administration Wednesday,
taking inventories to their highest since July 2021.

The bulk of this increase, however, could be put down to a roughly 3.5M barrel draw down from the Strategic Petroleum Reserve.
Prices have dropped sharply as a result with Brent falling more than 6% so far this week and WTI more than 7%.
Gold futures have also fallen 0.1% on the news.

 

 

 

Gold prices: A roller coaster ride

 

Gold prices have been on a roller coaster ride in recent weeks, as investors try to decipher the Fed’s next move on interest rates.

 

Topics
Gold and Dollar Correlation
Gold and Unemployment Correlation
Volatile Week for Precious Metals

 

 

 

 

 

Gold and Dollar Correlation

 

Prices slipped on Tuesday as the dollar regained some ground,
while investors braced for inflation data later this week that could provide more clues on the Fed’s policy path.

Spot gold was down 0.4% to $1,668.50 per ounce by 0844 GMT,
after hitting a three-week peak in the previous session when a weaker dollar boosted prices.
U.S gold futures shed 0.5% to $1,671.

The U.S. dollar has been on a quest to retain lost ground,
prompting a pause in gold’s surge post-jobs data.
The dollar index rose 0.3% higher after hitting a more-than-one-week low on Monday,
making bullion more expensive for overseas buyers.
However, the greenback’s rally may be short-lived as the underlying fundamentals remain weak.

 

 

 

 

 

Gold and Unemployment Correlation

 

The U.S. unemployment rate rose to 3.7% in October, according to data released on Friday,
which has induced optimism that the Fed will shift to less aggressive interest rate hikes.
This news helped gold record its best day since March 2020 as traders and investors alike see this as a good opportunity to invest in the precious metal.

This week, traders and investors will be focused on two key events:
the release of inflation data on Thursday and the U.S. midterm elections on Tuesday.

The inflation data is expected to be a key factor in the next Fed rate decision,
so markets will be closely watching for any clues about future policy direction.
Meanwhile, the midterm elections will determine control of Congress and could have a major impact on market sentiment.

Rising interest rates are often seen as a sign of impending inflation,
which generally leads to an increase in the price of gold.
This is because investors tend to flock to the precious metal as a safe haven asset when they believe that the value of other assets will decrease.
However, rising interest rates also have another effect on gold prices
they increase the opportunity cost of holding the asset.

This is because when interest rates rise, so do returns on other investments such as bonds and cash equivalents.
This makes these assets more attractive to investors,
who may then sell their gold holdings in favour of these alternatives.
As a result, we could see some selling pressure on gold prices if interest rates continue to rise in the coming months.

 

 

Volatile Week for Precious Metals

 

It’s been a volatile week for precious metals as investors keep a close eye on developments surrounding the COVID-19 pandemic.
After hitting fresh highs earlier in the week, silver prices have pulled back somewhat as traders weigh the prospects of further lockdown measures in top consumer China against vaccine progress and stimulus hopes.
Platinum and palladium prices have also come under pressure,
although both metals are still holding onto gains made earlier this month.

With infection rates rising in many parts of the world and concerns about new variants of COVID-19,
there is a growing risk that additional restrictions will be imposed to try to contain the spread of the virus.
This could weigh on demand for precious metals,
which are often used as safe haven assets during times of economic uncertainty.

 

 

 

The Dollar eases as the gold prices rebound

 

The dollar eases as the gold prices rebound; gold prices regained some ground on Friday as a slight pullback in the dollar helped alleviate some pressure from the U.S. Federal Reserve’s hawkish policy narrative.

 

Topics
What to expect from gold
Volatile but Profitable
What is the Fed’s perspective on interest rates?

 

 

 

 

What to expect from gold?

 

The Fed’s minutes from its March meeting, released on Thursday,
showed that policymakers were unanimous in their decision to raise rates and several members saw the need for additional rate hikes this year.
The strong data has bolstered expectations for another rate hike in June,
which would be the third this year.

The rise in gold prices came despite a strong rally in equity markets,
which have been boosted by robust corporate earnings and economic data of late. Gold is often seen as a safe haven asset during times of market turmoil or geopolitical uncertainty but has been under pressure recently as investor risk appetite remains high.

Looking ahead, gold prices may continue to see volatility as investors
digest more corporate earnings reports and await further clues on
monetary policy from central banks around the world.

The most recent data shows that gold is up 0.6%,
but this is still below the high of $1,700 per ounce that was seen just a few weeks ago.
While some believe that there may be more upside potential in gold prices,
others are concerned that the market could correct lower in the near term.
Either way, it looks like traders and investors will continue to closely
watch spot gold prices for any clues about where the market may be headed next.

 

 

 

 

Volatile but Profitable

 

Gold prices have been on a roller coaster ride in recent months,
testing the nerves of even the most experienced investors.
After reaching record highs in August, gold prices began to tumble,
and many experts believe that we are not out of the woods yet.

However, there are signs that gold may be beginning to stabilise.
Clifford Bennett, chief economist at ACY Securities believes that the
Fed’s recent interest rate hike and pledge to keep fighting inflation will help
to support gold prices in the short term.
Reuters technical analyst Wang Tao also believes that spot gold may bounce
back to $1,648 per ounce after breaking resistance at $1,632.

While it remains to be seen where gold prices will head next,
it is clear that they continue to be a volatile and risky investment.
However, for investors who are willing to take on some risk,
gold could still offer some profitable opportunities in the months ahead.

 

What is the Fed’s perspective on interest rates?

 

When it comes to investing in gold, there are pros and cons to consider.
On one hand, gold is often seen as a hedge against inflation.
This means that if the cost of living goes up, the value of your investment in gold should also go up.
However, on the other hand, high-interest rates can make it less attractive
to invest in gold since it doesn’t offer any yield itself. So what’s an investor to do?

It really depends on your individual goals and risk tolerance.
If you’re looking for stability and want to protect yourself against inflation,
then investing in gold may be a good option for you.
However, if you’re more interested in potential returns and are willing to take on more risk,
then there may be better options out there for you.
Ultimately, it’s important to do your own research and figure out what makes sense for you personally.

With the release of the U.S. non-farm payrolls data looming,
investors are closely watching for any clues on the Federal Reserve’s rate-hike stance.
A strong jobs report could reinforce the Fed’s hawkish posture and keep gold prices under pressure,
while a weaker report could provide some support for bullion.

The labour market is one of the most important indicators of economic health.
A strong labour market indicates that businesses are hiring and consumers have disposable income to spend.
The payroll data is closely watched by traders and investors because it provides a snapshot of the labour market.

A deceleration in job growth would be seen as a negative sign for the economy and could lead to lower interest rates.
This would be bullish for gold, as lower interest rates make gold more attractive as an investment.
However, if we see an upside surprise in the payroll data,
it would reinforce the Fed’s higher terminal rate posture and keep gold prices under pressure.