Gold Technical Analysis: Stable, Despite USD Strength

[ad_1]

The price of gold remained in a state of stability, heading to the upside, despite more hawkish hints by US Central Bank Governor Jerome Powell towards the future of raising US interest rates during 2022. These confirmations provided more impetus for the gains of the US dollar, and despite that, the price of an ounce of gold settled around the level of 1938 dollars at the time of writing the analysis. At the start of this week’s trading, the price of gold remained flat – after its biggest weekly drop since June – as investors weighed monetary tightening in the US against the impact of the Russia-Ukraine war. Gold prices fell 3.4% last week as the Federal Reserve raised US interest rates for the first time since 2018.

The Fed raised interest rates for the first time since 2018 last week and indicated, using its dot chart, policy makers’ expectations that the index could rise to between 2.5% and 3% over the next year. For his part, former US Treasury Secretary Lawrence Summers said the US Federal Reserve would need to raise borrowing costs higher than officials currently expect – to 4% to 5% – if it is to struggle with inflation once again under control. Higher interest rates affect non-interest bearing gold.

Advertisement

China’s one-year key loan rate, the actual benchmark lending rate, will also be closely watched for signs of China’s central bank easing after top leaders pledged measures to boost Asia’s largest economy. Besides, investors are also considering conflicting messages regarding the war in Ukraine. Turkey said Moscow and Kiev were close to reaching an agreement on key points, while a senior Ukrainian aide said Russia had switched to “more destructive artillery”.

Meanwhile, Ukraine has rejected a Russian demand that the besieged southern port city of Mariupol surrender. Gold – a haven asset – has been helped by that struggle.

According to the technical analysis of gold: The general trend of the gold market is still bullish despite the recent sell-offs. As I mentioned before, the Russian-Ukrainian war will remain an important factor for the continuation of gold gains despite the global central banks’ tendency to tighten their policy strongly this year. The continuation of the Russian war supports the idea of ​​buying gold from every descending level. The closest important support levels for gold are currently 1920 and 1880 dollars, and from the last level and less than it, it is better to buy gold at that stage.

The market’s attention will return to the historical psychological peak of 2000 dollars an ounce again if the price of gold moves towards the resistance levels of 1955 and 1980 dollars again. The price of gold today will be affected by the level of the US dollar and the extent to which investors take risks or not, as well as the reaction from the developments of the Russian war.

Gold

[ad_2]

Leave a Reply

Your email address will not be published. Required fields are marked *

Risk warning: Trading in Contracts for Difference (‘CFDs’) carries a high level of risk and can result in the loss of all your investment. As such, CFDs may not be appropriate for all investors. You should not invest money that you cannot afford to lose. Before deciding to trade, you should become aware of all the risks associated with CFD trading, and seek advice from an independent and suitably licensed financial advisor. Under no circumstances shall we have any liability to any person or entity for (a) any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to CFDs or (b) any direct, indirect, special, consequential or incidental damages whatsoever. For more information about the risks associated with trading CFDs please find and read our ‘Product Disclosure’.


Please recognize that this website is the only official website, please do not enter other clone websites through Internet search or advertisements.


© 2011 - 2024 mgtinvesting.com. All Rights Reserved.

en_USEnglish