The document discusses gold prices historically and currently. It provides 20, 10, 5, and 1 year gold price charts in USD/oz that show gold's value has fluctuated over time but generally increased. Factors influencing gold prices are also examined, such as the US dollar, interest rates, stock markets, and geopolitical tensions. The coronavirus pandemic has also driven recent high demand for gold as a safe haven investment.
2. Points To Be Discussed Today:
• Gold As Trade & Investment
• Gold Today’s Price Chart
• Gold Historical Price Charts
• XAU/EUR, XAU/XAG
• Why Look At Historical Gold Prices?
• Gold Price Under The Negative Pressure
3. Gold As Trade & Investment
• Gold is the world’s oldest mode of exchange. With its bright and
glossy appearance, gold is not only visually attractive! It also has
exceptional uses.
• Gold is regarded both as a long term investment and as a short
term hedge in times of uncertainty or nervousness in the markets.
• Gold prices therefore usually display enhanced volatility during
times of political or economic uncertainty, as this increases the
investor demand for the precious metal, due to its global
acceptability.
• Many economic factors influence the trading price of gold,
including interest rates, inflation, the supply and demand of the
yellow metal, the value of the US dollar and large gold
transactions by central banks.
11. Why Look At Historical Gold Prices?
• There are manifold factors involved in the
determination of a bullish bias in gold. Let’s explore
them one by one, in order to forecast the gold price.
• US Dollar and FED Monetary Policy (Negative Rate
Cuts): –
• Gold and the US dollar are negatively correlated nearly
two-thirds of the time (when one advances, the other
drops, and vice versa).
• While global investors do manage to run with the US
dollar through periods of uncertainty, this type of
movement was muted over the previous
year, despite the trade war with China.
12. Why Look At Historical Gold Prices? - I
• They preferred to go with gold. The US Federal
Reserve cut their interest rates from 1.75% to
1.25% in March, which drove sharp selling in the
US dollar and triggered a bullish bias for the
precious metal, gold.
• Later, considering the massive outbreak of
COVID-19, the Federal Reserve decided to cut the
rate even further on March 16, from 1.25% to
0.25%, which has made gold even more bullish
this year.
13. Stock Market Crash
• The recent 2020 crash on the US stock
exchange wasn’t only limited to the US.
Rather, it was a global stock market crash that
began on February 20, 2020.
• On February 12, the Dow Jones Industrial
Average, the NASDAQ Composite, and the S&P
500 Index all finished at record highs (while
the NASDAQ and S&P 500 reached
subsequent record highs on February 19).
14. Stock Market Crash - I
• From February 24 to 28, stock markets
worldwide reported their largest one-week
decline since the financial crisis of 2008.
• The relationship between the gold prices and the
stock markets is inverse.
• Mostly, the gold prices will drop when the stock
markets are performing well and vice versa.
• Likewise, when the stock market collapses, the
demand for gold increases, as more and more
investors are looking at safer options.
15. The Coronavirus Pandemic
• The COVID-19 outbreak, which was first identified
in China, has infected people in 188 countries,
and it has had a significant negative impact on
the global economies, thus increasing the safe-
haven demand in the market, and sending the
gold prices to record highs.
• Since the beginning of the year, investors have
turned to the safe-haven metal, and this
sentiment has been sustained, due to fears of the
second wave of the coronavirus.
16. The Coronavirus Pandemic - I
• As a result of such situations, the global equity
market often moves lower, while trading in
safe havens, like the US dollar and gold,
becomes bullish.
• Geopolitical Tensions – China and the US have
fired fresh sanctions at each other, in the
ongoing conflict that has made gold futures
climb to all-time highs.
17. Gold Price Under The Negative
Pressure
• Gold price shows some bullish bias after the strong decline
that it witnessed in the previous sessions, to test minor
resistance line located at 1785.00, affected by stochastic
positivity, while the EMA50 forms negative pressure against
the price, which supports the chances of achieving new
negative trades in the upcoming sessions.
• Therefore, the bearish bias will remain expected for today
unless the price rallied to breach 1797.00 and hold above
it, noting that the expected targets begin at 1770.00 and
extend to 1734.00 after breaking the previous level.
• The expected trading range for today is between 1770.00
support and 1795.00 resistance.
19. Midday Update For Gold 01-11-2021 - I
• Gold price tests the EMA50 that forms good
resistance against the price, noticing that
stochastic loses its positive momentum clearly,
waiting to motivate the price to resume the
expected bearish trend for the upcoming period,
which its first target located at 1770.00, while
achieving it requires holding below 1797.00.
• The expected trading range for today is between
1770.00 support and 1795.00 resistance.
• The expected trend : Bearish
