Source: Huitong Finance and Economics
Huitong financial app-- Monday (April 22), due to the intensification of conflicts in the Middle EastDragontigergateenglishConcerns receded and gold prices fell more than 2 per cent.
Commodity analysts said on the one hand that gold prices rose to record highs above $2400, creating dangerously overbought market conditions, while on the other hand, because of solid fundamentals, analysts also said that any market correction should be seen as a buying opportunity.
Although gold began to sell sharply this week, some analysts believe investors need to take a correct view of gold prices. Although gold prices fell more than 2 per cent in early trading in North America, they seem to have a chance to stay at about $2350 an ounce.
The 2% decline in gold prices is still negligible compared with the overall rally. Since holding support at $2000 in February, gold is still up nearly 17%.Dragontigergateenglish.5%.
As silver fell below $28 an ounce, the adjustment was even greater. The latest trading price of May silver futures is 27 per ounce.Dragontigergateenglish.525 US dollars, down 4.6% on the day.
Some analysts say there is still room for gold to fall further as the focus returns to US monetary policy and expectations that the Fed will maintain aggressive monetary policy for longer than expected are shifting.
According to CME's Fed Watch tool (FedWatch Tool), the market expects a 16 per cent cut in June and less than 50 per cent in July.
"Gold finds itself in a balance between risk aversion on the one hand and higher Treasury yields and a stronger dollar on the other," Ricardo Evangelista, a senior analyst at ActivTrades, said in a report on Monday. As tensions in the Middle East show signs of easing, market attention turns to assessing the resilience of the US economy and continued control of inflation. As the prospect of a recent Fed rate cut weakens and optimism about avoiding an open conflict between Israel and Iran grows, gold prices are likely to pull back and traders may start to liquidate their positions. "
Although there is room for gold prices to fall further, some analysts say the factors driving the gold price breakthrough still exist. Central banks continue to buy gold as a safe haven to hedge rising debt levels and dollar risks. Meanwhile, as Asian investors continue to diversify their portfoliosDragontigergateenglishThey still dominate the market.
Nicky Shiels, head of metals strategy at MKS PAMP, said she maintained her target price of $2500 an ounce despite recent falls in gold prices. "the absence of new bad news is bad news for gold and silver bulls," she said. Although geopolitics (or the dollar or interest rates) is not the primary reason for the rise in gold prices, the war premium has not been lifted. "
David Morrison, a senior market analyst at Trade Nation, said gold prices were likely to fall, but pointed out that previous pullbacks had proved to be good buying opportunities. When precious metals experience the gains of the past 10 weeks, the sell-off can be severe, but also short-lived. Nevertheless, these two metals are still well above any important support level. The question is, will prices be retested or will prices go up regardless of it?
Carley Garner, co-founder of brokerage DeCarley Trading, said she believed a pullback to $2330 or $2300 was a solid entry point for investors who missed the initial rally. Her current upside target for gold is $2650 an ounce.
Capitalight Research lead researcher Chantelle Schieven in the London Bullion Market Association (London Bullion Market Association) price forecast this year, gold forecast is the most optimistic. She said gold prices could fall back to $2150 an ounce this summer, but added that she expected gold prices to break through $2500 an ounce by the end of the year, above her previous target of $2400 an ounce, which has now been met.
Ole Hansen, head of commodities strategy at Saxo Bank, said in a social media post that there were few technical indicators to rely on as the price of gold rebounded in a breakthrough. He is watching the Fibonacci withdrawal levels of $2322, $2288 and $2255.
Although some gold analysts point out that investors still hold sizeable gains, which means there is no urgency to sell.
(spot gold daily chart source: Yi Huitong)
"Gold is overbought, but our advanced positioning analysis suggests that 'practical information' may be surprisingly limited," commodities analysts at TD Securities said in a report on Monday. In the recent rally, the participation of fund managers was limited, and when the gold price reached $2200 / oz, the substantial undervaluation relative to interest rate market expectations was largely resolved. we see little evidence that macro funds have a large number of long positions that are easy to fall. Compared to the first sales plan, CTA has a large margin of safety. "
Spot gold fell 2.00% to $2342.58 an ounce at 22:49 Beijing time.