Price broke above a previous high in the previous trading session, creating an Ichimoku reversal with a V-shaped price projection target at $180.04. Conversion line and Base line had a bullish crossover and is hinting of a bullish price trend ahead. Lagging Span is above price of 26 days ago and above the cloud, confirming the bullish price trend. MACD is bullish and is hinting at a bullish price trend. If price can stay above the Ichimoku breakout, it could be heading towards the Ichimoku price project target at $180.04 in the next 2-3 weeks.
We think Gold will continue to move higher in the next 3 months. Our reasons are 1. Global loose monetary policies 2. US Stimulus package to help the US economy 3. COVID-19 4. US-China tensions
Just to name a few central banks that have interest rate close to zero. (0% to 0.1%) Federal Reserve Bank, European Central Bank, Bank of England, Reserve Bank of Australia, Bank of Japan. Global loose monetary policies are likely to be maintain to keep interest rate low in order to help their respectively economies to recover from the COVID-19 induced economic recession. The side effect of this policy is in later months, it is likely to lead to higher inflation. Gold is a hedge against inflation and will benefit from this policy.
In the aftermath of the US Election, while Trump or Biden becomes US President is still not clear, one thing is clear; the US economy is in need of a stimulus package to help it deal with the coronavirus induced pandemic. It would be a bigger amount with Biden but even a smaller amount with Trump will also lead to higher Gold prices. This fiscal policy will lead to higher inflation which will benefit Gold.
Other lesser issues like rising COVID-19 cases and US-China tensions are also likely to support Gold. With these factors supporting a rally in Gold prices, how can investors take advantages of this Gold rally? There are 2 avenues to partake in Gold rally. Investors can look to go long on spot Gold commodity or look to buy CFD ETF on Gold. Both offer leverage for clients to take greater advantage of this gold rally.
Last night price broke out of a downtrend line. We see price going to the next resistance at $1975 and then to $1993 on a longer term. By Feb 2021 we see price testing the high of $2080Price may have ended its correction and is above to move above the cloud. If price were to move above the cloud tonight, it would be the start of a new bullish trend which could bring price higher to the previous high of $194.50.Price is likely to break above the cloud tonight as the spot Gold commodity has continued to move higher today. A break above the cloud is likely to send price higher to the previous high at $19.76For more information Contact us at 6590 6735 Email us at alternativeproducts@utrade.com.sg Whatsapp @ 8636 1600
