International spot gold traded at $1,602.70 an ounce in early Asian trading on Wednesday. Intraday gold has been trading around high levels after a choppy surge to a high of $1,605.00 an ounce in the previous session and remains above $1,600.
With the spread of the new champions league pneumonia outbreak, the market risk aversion to heat up, on Monday (Feb. 17) the company warned that the global public health events has slowed production process, and weakened demand, the company may find it hard to realize in the first quarter revenue forecast, which further exacerbated the market worries, rising gold and break through the $1600 mark.
COMEX gold for April delivery ended up $17.20, or 1.10 percent, at $1,603.60 an ounce, its highest close since late March 2013.
“Equities are under pressure and gold is still seen as a classic safe haven because we do hear some negative news about the coronavirus and its impact on the global economy,” said David Meger, head of metals trading at High Ridge Futures.
“The market is starting to price in the fact that there are concerns that the whole coronavirus situation could be a bit worse than many expect, which means central Banks around the world will be somewhat more dovish,” said Bart Melek, head of commodity strategy at td securities.
Phillip Streible, chief market strategist at Blue Line Futures, said, “the gold market has been waiting for a big event to push prices higher.” Streible added that equity sentiment appears to be shifting, which will continue to support gold. Streible notes that stock market valuations have been out of touch with reality for a long time and could be subject to sharp corrections. As for how high gold can go, Streible said he expects initial resistance at $1,620, with the next target at $1,650.
Outbreak, according to the national WeiJianWei latest bulletin, February 18, 0-24, 31 provinces (autonomous regions and municipalities directly under the central government) and the xinjiang production and construction corps report 1749 cases of the new cases, 236 cases of serious illness case of illness, new new death cases, 136 cases (132 cases of hubei province, heilongjiang, shandong, guangdong, guizhou, 1 case), the new suspected cases of 1185 cases.
On the same day, 1,824 new cases were cured and discharged from hospital, and 2,014 close contacts were released for medical observation.
On the daily chart, the dollar index remained on its recent upward trend, peaking at 99.49. Technically, the MACD red kinetic energy column is slightly narrowed, while the KDJ random index is slightly under pressure, indicating a respite in the upward momentum of the dollar, which may be followed by a retreat from high pressure.
As shown in the 4-hour chart, the dollar index held steady and rose, with the MACD red momentum column slightly enlarged, and the KDJ random index inclined to the upward direction, indicating that the short-term upward momentum of the dollar had slightly strengthened, followed by or continued to maintain the upward trend.
On the daily chart, gold prices held steady on the recent rally, with the MACD red momentum column showing and expanding, and the KDJ random index biased to the upside, indicating that gold’s upward momentum is still there and incoming materials continue to maintain the rally.
On the 4-hour chart, gold continued its upward trend, with the MACD red momentum column holding steady, and the KDJ random index slightly under pressure, indicating a pause in gold’s rally, followed by a pause in highs.
Fundamentals favorable factors:
1, on Wednesday (Feb. 19) according to hubei province WeiJianWei bulletin, as of February 18, 24, according to the 31 provinces (autonomous regions and municipalities directly under the central government) and the xinjiang production and construction corps, the existing 57805 cases of confirmed cases of 11977 patients with severe cases (), the cumulative cured cases, 14376 cases of hospital, the cumulative death cases, 2004 cases, has reported 74185 cases of confirmed cases, the existing 5248 cases suspected cases. A total of 574,418 close contacts were traced, and 135,881 close contacts were under medical observation.
2.On Tuesday, the us government announced major new sanctions against the Russian oil company Rosneft for helping the Venezuelan leader Nicolas Maduro circumvent us sanctions. The sanctions announced by the U.S. Treasury targeted Rosneft Trading SA, a subsidiary of Russian oil company Rosneft. The decision marks a significant escalation in U.S. President Donald trump’s campaign to pressure Mr. Maduro and a rare confrontation with Russian president Vladimir Putin.
3.Apple warned on Monday that it would struggle to meet its first-quarter revenue forecast as global public health events slowed production and weakened the demand outlook. Apple’s revenue warning boosted safe-haven demand for gold by weighing on risk sentiment as concerns grew about the economic impact of new pneumonia.
4.The NAHB index of U.S. home prices, released on Tuesday, stood at 74 in February, compared with expectations and a previous reading of 75.
Fundamental negative factors:
- The New York fed’s manufacturing index rose to 12.9 in February from 4.8 in January, beating analysts’ expectations of 5, according to data released on Tuesday.
2. On February 17, the world health organization (who) held a press conference in Geneva, saying it would not raise the global risk level of a new outbreak of coronary pneumonia, CCTV news reported Tuesday. Who director-general tandesay said the number of new cases of coronary pneumonia in China showed a downward trend.
3. The people’s bank of China (pboc) issued a statement on Monday (February 17), saying that on February 17, the people’s bank of China (pboc) launched the 200 billion yuan medium-term lending facility (MLF) and 100 billion yuan seven-day reverse repo operation to hedge the impact of the central bank’s reverse repo expiration and other factors and maintain reasonable and abundant liquidity in the banking system.
4. Separate data released on Friday showed the university of Michigan’s preliminary consumer confidence index rose to 100.9 in February, close to the expansion peak of 101.4 set in March 2018. Meanwhile, the university of Michigan’s preliminary expectations index for February rose to 92.6, the second-highest level in the long-term expansion.