Analysis of Gold News: On Saturday (October 21), the US dollar fell to 106.15, falling below its 20-day moving average, and gold retreated to 1981 US dollars, sending a signal of short-term weakness. The situation in the Israeli-Palestinian conflict has changed dramatically. Hamas has confirmed the release of two American hostages, and US President Biden has pressed Israel to postpone ground operations. As investors seek safe haven assets in the turmoil, gold prices have jumped four times, reaching a new three-month high, the highest level since late July. The situation in the Middle East is uncertain, and investors have shown strong risk aversion over the weekend. Gold continues to perform strongly this week, and the ongoing conflict in the Middle East has pushed gold spot prices close to the $2000/ounce level. It seems that a new historical high in the near future is imminent. Similar to last week, investors bought gold on Friday, hoping to hold some gold as insurance over the weekend. There are reports and rumors that the Israeli army may launch a ground attack on Gaza over the weekend. This hedging demand has pushed up the price of gold, reaching its highest level in three months.
Gold has not only seen impressive gains in the past two weeks, but this has also occurred against the backdrop of the Federal Reserve maintaining its stance of keeping interest rates in restricted areas. In addition to political uncertainty, gold has now become an economic safe haven asset. The focus will be in the middle of next week, when the US gross domestic product for the third quarter is first announced. Economists point out that the strong performance of the US economy is the main reason why bond yields have risen to 16 years ago. Next week will end with important inflation data, which may affect gold prices. Although investors will continue to focus on next week's political headlines, the busy economic schedule may also trigger some fluctuations. In addition to closely monitoring the political situation over the weekend, investors should also pay attention to economic indicators such as the initial value of the US Purchasing Managers' Index (PMI), the Bank of Canada's monetary policy decision, US new home sales, the European Central Bank's monetary policy decision, US third quarter GDP, US durable goods orders, completed home sales, the US Core Personal Consumption Expenditure (PCE) price index, and personal income and expenditure.
Technical analysis of gold: Due to continued support from risk aversion, gold has continuously risen to new highs in the first line of 1997 this week, one step away from the 2000 level. At present, the market is still a bullish trend, and the 2000 level is definitely about to break, but it is difficult to determine whether it can break in the short term. The recent major cycle of the market has been running along the trend line, stabilizing upwards from 1810 on the daily line, with a bullish increase of $187. Next week, along the trend line of the 4 hour chart, bulls are strong. And he never broke through the top and bottom to change support. So, don't think that if the price is high, you can short, and don't think that if the price is low, you can long; As long as the bull market remains unchanged, the price can be higher if it is higher, and as long as the bear market remains unchanged, the price can be lower if it is lower.
Regarding the trend of gold, it broke through the previous high of 1987 on Friday, and the bullish trend remained unchanged, relying on the trend to support the 1960 dry long. Focus on the breakout of 2000. If it breaks through, gold will continue to maintain its current upward trend. However, if it still falls under pressure, it may need to undergo a wave of adjustments before continuing. So 1960 is still very important, which determines whether our future operation strategy is high altitude low much or low much. For the current market situation, we will continue to maintain a low long position and continue to long, relying on the 1960 frontline to continue entering the long position. The lowest decline cannot break below the 1955 position. Before the trend changes, we will continue to focus on going back and long. If the market breaks through the 2000 level, it will see resistance until 2015-2020.
The short-term focus above is on the resistance at the 1994 1990 level,
The short-term focus below is on support from 1965 to 1967.
Due to concerns that escalating conflicts in the Middle East may disrupt supply, oil prices will rise for the second consecutive week. US crude oil prices rose 1.2% to $90.42 per barrel, while Brent crude oil prices rose 0.9% to $93.25 per barrel. The Chief Global Strategist stated that the focus on supply has become a key focus in the bond market, with concerns that the US deficit may climb due to increased demand for defense funds in Washington. We are not only talking about the conflict between Ukraine and Russia, but also about another front, which is the Middle East. It must be met, and then the United States will need more and more oil supply to pay for all these costs through auctions
American drilling companies have increased oil drilling for the second consecutive week. Last week, the number of American oil drilling rigs increased by one to 502. But this increase is difficult to calm investors' anxiety.
The recent visits of US President Joe Biden and British Prime Minister Richie Sunak have yielded mixed results. Earlier this week, Biden's important meeting with Arab leaders was cancelled, but subsequent discussions with the Egyptian President reached an agreement to provide assistance to Gaza through appropriate Egyptian means.
Less than 24 hours after returning to the United States from his visit to Israel, US President Biden delivered a national television speech on the evening of the 19th local time, stating that he would seek an emergency additional budget allocation from the US Congress and calling it "a wise investment that will bring rewards for the security of generations of Americans". Regarding this, Russian Foreign Ministry spokesperson Zakharova pointed out that "for the United States, war has always been a so-called 'wise investment' because war does not occur on American soil, and they do not care about the costs borne by other countries. Therefore, people expect the Israeli military to launch a ground invasion of Gaza soon.
Short positions in crude oil have increased, with data from the US Commodity Futures Trading Commission (CFTC) showing that WTI's speculative net long positions in crude oil futures decreased by 56850 positions to 183351 positions in the week ended October 17. At the same time, investors are more confident in the safe haven function of gold. According to data from the US Commodity Futures Trading Commission (CFTC), as of the week ending October 17th, COMEX gold futures speculative positions have shifted to net long positions, increasing 56655 contracts to 41867 contracts.
As investors sought refuge in the turmoil, spot gold prices hit a three month high of $1990 per ounce, the highest level since late July. COMEX December gold futures closed 0.70% higher at $1994.40 per ounce, with a cumulative increase of 2.72% this week. COMEX February gold futures closed 0.71% higher at $2014.50 per ounce, up 2.72% this week.
The famous "panic index" on Wall Street is sending worrying information to the US stock market, exposing the anxiety of volatile markets about the escalating tension in the Middle East and the continued turmoil in the bond market.
Kyle Rodda, a senior financial market analyst at Capital.com, said: "There are many reasons why investors want to sell this market, but very few buy it. This is the situation we see today of risk selling." "Simply put, market participants do not want to take risks when hostilities erupt over the weekend
Marc Chandler, Managing Director of Bannockburn Global Forex, also expects a pullback in gold prices. Chandler said, "After a rapid increase of nearly $100 per ounce last week, gold has risen by about $46.50 per ounce this week." He said, "The political situation is the main driving factor, it has thwarted the inhibitory effect of interest rate hikes. The dollar has sent a contradictory signal
Chandler stated that it is difficult to imagine the rise of gold weakening without a resolution to the Middle East situation, but he still believes that this move is a bit exaggerated.
John Kilduff, a partner at the New York Energy Hedge Fund Again Capital, said: "At different stages of history, the positive correlation between the unified price per barrel and gas station prices has broken. However, the result is often an increase in gasoline prices, rather than a decrease. This means that even if crude oil prices fall, gasoline prices will still remain higher than expected due to oil refining cracks and blowouts However, what is happening now is quite remarkable. Despite the explosive rise in crude oil prices, especially in recent months, the retail price of gasoline has remained almost unchanged for over a year. Once again, this is a function of natural gas cracking, as the supply of gasoline exceeds demand, and natural gas cracking has decreased so low that it once turned negative
Although gasoline prices have fallen by about a penny a day, the pace is as slow as a glacier, "said AAA spokesperson Andrew Gross." The oil market is paying attention to whether the war between Israel and Hamas is expanding, so prices have remained at a high level of around $80 per barrel. This in turn has slowed down the decline in natural gas prices Although increasing demand and tightening supply usually increase gasoline prices, a flat oil price has the opposite effect. If oil prices remain stable or fall, drivers expect further declines in gasoline prices in the coming weeks
The data that investors need to focus on include the initial value of the US Purchasing Managers' Index (PMI), the Bank of Canada monetary policy decision, US new home sales, the European Central Bank monetary policy decision, US third quarter GDP, US durable goods orders, existing home sales, the US core personal consumption expenditure (PCE) price index, and personal income and expenditure.
Last Friday, crude oil opened for delivery at $89.150 per barrel, and then the oil price fluctuated and fluctuated, adjusting at a resistance of $89.5 per barrel. From the daily trend chart of crude oil, it can be seen that the daily trend includes a large positive line, with low prices first breaking low and then breaking high, and closing at a high level. The performance is relatively strong, and it will continue to be bullish in the future. At the four hour level, crude oil showed a wave of upward breakthrough after a double bottom support of 81.5-82.3, and the moving average system crossed below the oil price to form support. According to channel calculations, the strength line below is at the $87.5 line. After the unexpected break, the bullish pattern of crude oil will return to volatility.
Pay attention to the resistance of $88.8- $88.5 above,
Follow the support of $86.0- $86.3 below.
