Gold Growth stopped at a strong level of $2000
Last week, we mentioned the buy sentiments of gold as a safe-haven asset.
Now that the market has priced banking crises what are the gold movement drivers?
Recession, yes fear of stagnation is remain. Fear of recession in the global economy remains and now the gold buyers are still in their long positions.
Why do the world’s banks buy gold?
On the other hand, the multi-polarization of economic powers and the formation of new regions in the east by China and Russia, and the declining influence of the US dollar as the global reserve currency has been the main driver of gold’s rally to the $2,000 level last week.
Undoubtedly, China and Russia intend to free themselves from the vortex of the global economy, which is heavily dependent on the US dollar. The concern about the extreme fluctuations of the dollar and the euro has caused the demand for gold to increase from the central banks of the world. Concerns about the trade war and the possibility of a currency war between China and the United States are also considered important factors.
Last week, we read in the news that China made its first liquefied natural gas transaction in yuan through the Shanghai Oil and Gas Exchange. Also, last week, China and Brazil announced that they will carry out trade and financial exchanges between them in Riel (Brazil’s currency) and Yuan, to which Saudi Arabia, the United Arab Emirates, and the Middle East have also been added. The result is less use of US dollars and more use of gold.
The closing price in the previous month’s candle shows the strong power of major buyers of gold, and this defends the upward trend of gold in the long term.
From a technical point of view, we are currently in the overbought zone for Gold/XAU. This does not mean that gold will go down. Rather, we consider it only a price correction and collecting more liquidity at lower prices for new buyers.
$1955, $1937, and $1910 are our main support levels.
Mon Apr 3, ISM MANUFACTURING PMI (MAR)
Wed Apr 5, ADP NONFARM EMPLOYMENT CHANGE (MAR)
and on Fri Apr 7 NONFARM PAYROLLS (MAR) is our main event’s impact on gold.