The value of gold in global markets falls for fourth day in a row
Gold prices fall a fourth day in a row. Quotes accelerated the decline on yesterday’s rally of the dollar in terms of flight from risks. Despite the fact that during the previous two weeks quotes of the precious metal recovered, “American” remains a more attractive safe haven asset than gold, which you still have to try hard to regain its former appeal in the eyes of investors.
In the short term, the metal has a chance to surge in demand if the dollar will get hit from the Federal reserve. Here much will depend on today’s speeches by fed’s Powell’s-and tomorrow’s minutes of the meeting. If market participants will see a tone regulator notes of caution, the USD will come under pressure in the face of increasing doubts of investors that the Central Bank will continue to tighten policy promised earlier pace.
If to speak about the longer term, in the context of a further decline in global stock markets (and the probability of such a scenario is large), players will show more interest to buy the dollar, rather than gold for the simple reason that the precious metal is going to be unattractive in terms of tightening policy of the Central Banks of the world, including those which will put pressure on the stock.
From a technical point of view, in the foreseeable future, the gold need to go beyond the level of 1220 and at the moment is to stay above the marker 1210, to avoid a deeper drawdown.
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