Gold investments: bullish consensus? Lose worry and avoid risk coexist! Gold may face the perfect storm again this week!

International spot gold was at $1682.10 an ounce in Asian trading on Monday, having earlier surged as high as $1691.50 an ounce.

On the day, gold hit a one-month high of $1691.50 an ounce as the fed stepped up its efforts again, sending the dollar index sharply lower. Despite the market affected by the Easter holiday on Monday, but investors are still betting, demand is still strong in global risk aversion, and central Banks fell in to continue increasing the money supply to help the economy through the background, the gold will usher in a new round of rally this week, analysts expect short-term gold prices will further on the $1700 mark.

Meanwhile, gold futures jumped 6.11 per cent last week to a 7 year high of $1,754.50 an ounce, the highest level since October 2012, driven by risk aversion and rising concerns about quantitative easing.

The most actively traded June gold futures on the New York mercantile exchange closed up 4.07% at $1752.8 an ounce, the highest level since October 2012. Silver futures for may delivery closed at $16.053 an ounce, up 9.71% for the week. Platinum for July delivery closed up 4.07% at $748.6 an ounce.

Market analysts cited inflation fears, a drop in consumer confidence, a weaker dollar and investors buying gold as a safe haven as the main reasons for the rally.

According to an online poll of 1,172 Wall Street and main street investors, a whopping 821 (70%) expect gold prices to rise in the coming week, while 222 (19%) expect prices to fall and 129 (11%) are neutral. Specifically, 100% of Wall Street respondents and 70% of main street investors are now bullish on gold, up from 92% and 67% the previous week, respectively.

“It’s going to be choppy, but as costs from a novel coronavirus seep in, it’s bound to move higher,” said Adam Button, managing director at ForexLive.

“I’m still bullish on gold,” said Kevin Grady, President of Phoenix Futures and Options LLC. “While equity markets seem to have taken hold, I still believe that the amount of money pouring into the global banking system, combined with historically low interest rates, will push gold above $1,850.”

“Gold is still bullish for the next week,” said Phil Flynn, senior market analyst at the Price Futures Group. “Not only are markets benefiting from the risk environment, but the long-term impact of us quantitative easing and global economic assistance will also provide a good fundamental basis for gold to rise.”

Daniel Pavilonis, senior commodities broker at RJO Futures, said he expected gold prices for June delivery to recover above this week’s high of $1,742.60. Equity markets also appear to be recovering, he said, opening the door to higher gold prices. For about two weeks in March, both events occurred simultaneously.

Colin Cieszynski, chief market strategist at SIA Wealth Management, and Charlie Nedoss, senior market strategist at LaSalle Futures Group, also said they were bullish based on the central bank’s actions.

“Some of the fed’s moves look like they’re going to cause a lot of inflation,” Nedoss said. They’ve been spending a lot of money. It seems that gold is starting to trade with inflation at the same time as equity markets are rebounding.”

Phillip Streible, chief market strategist at Blue Line Futures, also expressed bullish expectations. “Investors are still not sure whether the rally in U.S. stocks will continue, so everyone has the underlying need for safety in mind,” he said.

Sean Lusk, co-head of commercial hedging, expects gold futures to continue to rise in June with a final price target of $1,827. “We have a ‘perfect storm’ of rising gold,” he said.

Technical analysis:

The dollar

On the daily chart, the dollar index maintained its recent rally, the MACD green momentum column held steady, the KDJ random index slightly higher, indicating the dollar upward momentum held steady, the next expected to continue to hold steady.

On the 4-hour chart, the dollar index showed a fairly narrow range of consolidation trading, MACD green kinetic energy column unchanged, KDJ random index moderate high, indicating the dollar short-term momentum mixed, then or continue to maintain a narrow trading pattern.

gold

On the daily chart, gold prices further shock rally, MACD red momentum column amplification, KDJ random index slightly higher, indicating gold momentum to strengthen, next expected to further rally.

On the 4 hour chart, gold prices steady rise, MACD red kinetic energy column slightly narrowed, KDJ random index moderately lower, indicating that gold short – term may be high fall.

fundamentals Positive factors :

  1. According to statistics from real-time information and data update website worldometers, as of 07:45 Beijing time on April 13, there were more than 1.85 million confirmed cases and more than 110,000 deaths worldwide, including more than 560,000 confirmed cases and more than 22,000 deaths in the United States.
  2. Parts of the United States may be ready by may to ease their defenses, said Dr. Joseph fauci, director of the national institute of allergy and infectious diseases.
  3. The Moscow times reported 2,186 new cases of coronavirus infection in Russia on Sunday, bringing the country’s official number of cases to 15,770, a record for a single day.
  4. The labor department reported 6.66 million new claims for state unemployment benefits in the week ended April 4, compared with expectations of 5 million, up from 6.648 million.

Fundamental negative factors:

  1. OPEC and its allies agreed to cut oil output by 9.7 million barrels per day (BPD) in the biggest ever cut, which was finalized Sunday local time.
  2. Anthony Fauci, President of the national institute of allergy and infectious diseases, told fox news on Wednesday that the number of coronavirus-related deaths in the United States is now lower than initially estimated, and noted that the situation should improve after this week. However, he added that efforts to deal with the virus should be strengthened.
  3. US President Donald Trump said on Tuesday that it is time to seriously consider restarting economic activity. We will restart the economy much sooner rather than later. It is happy to restart the economy now, but some places have been hit hard by the outbreak.

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