Book Online or Call 1-855-SAUSALITO

Sign In  |  Register  |  About Sausalito  |  Contact Us

Sausalito, CA
September 01, 2020 1:41pm
7-Day Forecast | Traffic
  • Search Hotels in Sausalito

  • CHECK-IN:
  • CHECK-OUT:
  • ROOMS:

Gold price is down 6.7% in the past two weeks. Here’s what we can expect in February

By: Invezz
Gold price weakened on Covid-19 vaccine news

Gold prices are closed the week 1.1% lower after plunging nearly 2.6% the week earlier. A new stimulus plan unveiled by President-elect Joe Biden may provide a boost to gold investors.  

Fundamental analysis: All eyes on stimulus

President-elect unveiled his much-anticipated $1.9 trillion stimulus plan two days ago. The plan includes higher-than-expected stimulus checks, and bigger support for the unemployed, small businesses, states, and local governments. 

The new stimulus plan is expected to yield a downward pressure on the U.S. dollar but also support for gold prices. 

“Bouts of dollar strength and the uptick in U.S. yields have triggered short-term corrections,” said Standard Chartered Analyst Suki Cooper.  

“The gold market is caught between longer-term buying on the back of rising inflation expectations given stimulus measures, but selling as the dollar has bounced and concern over QE tapering materialised.”

However, analysts are looking surprised by the short-term resilience of the U.S. dollar. 

“The Biden administration should support a much more expansive spending agenda than before. “But it seems like the stubborn short-term resilience of the dollar and concern for even higher yields is triggering steady liquidation in gold,” said Tai Wong, head of base and precious metals derivatives trading at BMO.

Technical analysis: Failed breakout?

Gold prices are now trading about 6.7% lower compared to the 2021 highs printed on January 04. This week’s low of $1,817 per ounce is the lowest the prices of the yellow metal traded since late November. 

Gold prices weekly chart (TradingView)

The failure to close higher last week resulted in a failed breakout. This is likely to yield a bearish pressure on gold prices in the short-term with the crucial support located at $1,770 per ounce. 

Summary

Gold prices are down nearly 7% resulting in a failure to close the week higher despite positive fundamental developments. The risk is tilted to the downside in the short-term.

The post Gold price is down 6.7% in the past two weeks. Here’s what we can expect in February appeared first on Invezz.

Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.
 
 
Photos copyright by Jay Graham Photographer
Copyright © 2010-2020 Sausalito.com & California Media Partners, LLC. All rights reserved.