Gold investment: the epidemic spread, this country “total collapse”! Gold shot up to 1680 at one point and Goldman Sachs to 1750!

international spot gold traded at $1,663.50 an ounce in early Asian trading on Monday. Gold surged above $30 in early trading to a high of $1,680.83 an ounce on rising risk aversion from the spread of the disease.

“The market is nervous again because of the potential for the outbreak to spread beyond China,” said Edward Moya, senior market analyst at OANDA. With the slowdown in China, Japan and Germany expected to continue through the first half of the year, there is a huge demand for safe havens. Expectations of full central bank stimulus are quite high and this will continue to push gold higher.”

“The fact that gold has continued to rise in spite of the dollar’s strength suggests that the breakout is warranted and sustainable,” Nicky Shiels, metals strategist at Scotiabank, said in an email.

“Gold is in the midst of a perfect storm,” said Ole Hansen, head of the commodity strategy at Saxo bank.

Even if the coronavirus is contained in the first quarter, low Treasury yields and weak equity markets could push gold further toward $1,750 an ounce, Goldman said.

In the domestic new crown, pneumonia epidemic has not yet appeared the inflection point, the epidemic has spread to many countries in the world, this country is the whole territory “collapse”, the epidemic quickly spread in various regions of South Korea.

A total of 161 new cases of coronavirus were confirmed in South Korea as of 9 a.m. on Monday, bringing the total number of confirmed cases to 763 and seven deaths, according to the ministry. Among the new, confirmed cases were 142 in Daegu and Gyeongsang north.

The government of the Republic of Korea (rok) on Wednesday issued a “serious” alert, the highest level for a new outbreak of coronary pneumonia, and set up the central disaster safety department to step up epidemic prevention. The government also decided to postpone the start date of the 2020 school year from March 2 to March 9.

South Korea’s defense ministry said Thursday that 11 soldiers, including 8 from the army, 1 from the navy, 1 from the air force and 1 from the Marine corps, had been diagnosed with pneumonia by 8 am, Yonhap reported. Reports say infections are suspected in the barracks.

South Korean President moon Jae-in announced Tuesday afternoon that the government has raised the alert level for a new outbreak of pneumonia to the highest level of “serious” on the advice of infectious disease experts, significantly strengthening the anti-epidemic response system.

A few days ago, South Korea’s Daegu outbreak of the new coronavirus super transmission event, epidemic prevention departments actively isolation and contact with the 31st confirmed case, and the patient with the “new world” Daegu church with 1001 members of the implementation of home quarantine measures.

Technical analysis:

The dollar

On the daily chart, the dollar index fell sharply, hitting a high of 99.92 last week. Technically, the MACD red kinetic energy column continues to narrow, the KDJ random index is under further pressure, indicating that the dollar downward kinetic energy restart, the incoming material further to carry out a pullback.

On the 4-hour chart, the dollar index held its recent upward trend, with the MACD red momentum column narrowing, and the KDJ random index slightly tilted lower, indicating a slowdown in the dollar’s short-term upward momentum, followed by or continue to come under pressure.

gold

On the daily chart, gold prices held steady on the recent uptrend, with the MACD red momentum column expanding and the KDJ random indicator slightly under pressure, indicating that gold’s upward momentum remains and incoming materials continue to hold steady on the uptrend.

On the 4-hour chart, the gold price also maintained its recent upward trend, with the MACD red momentum column expanding and the KDJ random index slightly under pressure, indicating that gold’s short-term upward momentum has been suspended.

Fundamentals favorable factors:

  1. As of 9 am on Monday (February 24), 161 new cases of coronary pneumonia had been confirmed in South Korea compared with 4 PM the previous day, with a total of 763 confirmed cases and 7 deaths, according to the headquarters of the central epidemic prevention department of the republic of Korea. Among the new confirmed cases were 142 in daegu and gyeongsang north.
  2. As of 21:20 local time on the 23rd, the total number of confirmed cases of the new coronary pneumonia in Japan was 838, including 133 people infected in Japan and Chinese tourists, 691 passengers and crew of the “diamond princess” cruise ship, and 14 people who returned to Japan by chartered plane of the Japanese government.
  3. On February 20, shandong reported 202 new cases, including 200 in rencheng prison. A total of 27 new cases of coronary pneumonia were confirmed in shilifeng prison in zhejiang province on Tuesday, and the provincial department of justice sent a team to the prison. A total of 271 new cases of coronary pneumonia were confirmed in the prison system in hubei province on February 21, including 230 at wuhan women’s prison, hubei daily reported.
  4. According to data released by the us on Friday (February 20), the preliminary Markit composite PMI in February fell to 49.6, the lowest level since 2013, the first time it has fallen below the threshold of 50 since October 2013. The services PMI came in at 49.4, the first time it has fallen below the 50 level that separates expansion from contraction since February 2016. Excluding the impact of the 2013 U.S. government shutdown, U.S. business activity contracted in February for the first time since the financial crisis, said Markit chief business economist Richard Williamson. The main problems were in the services sector, where activity fell for the first time in four years, and manufacturing production was hit by near-stagnant growth in new orders.

Fundamental negative factors:

  1. Initial claims for state unemployment benefits rose 4,000 to a seasonally adjusted 210,000 in the week ended February 15, in line with expectations, the labor department said on Thursday. That suggests continued strength in the labor market could help support the economy amid the risk of coronavirus and weak business investment.

2. The Philadelphia fed’s manufacturing index jumped to 36.7 in February from 17.0 in January, the highest level since February 2017, the fed said on Thursday. Separately, the Philadelphia fed’s index of new manufacturing orders in February was at its highest level since May 2018.

3. On Wednesday, U.S. housing starts fell less than expected in January and construction permits rose to a nearly 13-year high, suggesting the housing market’s continued strength could help keep the longest economic expansion in history on the track. The Commerce Department said it expected 1.425 million new homes to start last month at a seasonally adjusted annual rate of 1.667 million. Permits for construction surged 9.2 percent in January to an annual rate of 1.551, 000 units, the highest since March 2007, with both single-family and multifamily building permits up.

A separate report from the labor department on Wednesday showed the producer price index for final demand jumped 0.5 percent last month, the biggest gain since October 2018, after rising 0.2 percent in December. PPI rose 2.1 percent in the 12 months to January, its biggest gain since May, compared with 1.3 percent in December. Economists had forecast a 0.1 percent month-on-month increase and a 1.6 percent year-on-year rise.

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