Gold: Continuing to be long as the mood remains bullish
Gold prices have been bullish since last Friday, when they turned around $1,616, and made some really strong moves during the week.
Gold recently jumped to a more than two-month high as data showed that U.S. inflation fell slightly in October, raising hopes that the Federal Reserve will take a less aggressive approach to raising rates after the steepest period of rate hikes in history.
- Gold prices declined later, although they were set for their biggest weekly gain in more than eight months, as sentiment improves on the Fed’s less hawkish scenario in the coming months.
- On the other hand, the U.S. dollar has stabilized, with the dollar index trading in a sideways trend today after yesterday’s collapse, although it is headed for its biggest weekly drop since March 2020.
- The weak dollar makes gold more attractive to foreign buyers.
Discipline in trading with top brokers is a very important point that clearly shows a sign of skill. Only disciplined traders will never lose their deposit. You should not risk more than 2% in one deal, but for some reason in some deal you take and risk 5%. This will be a sign of a lack of discipline. Rules should be observed in all transactions with no exceptions.
Spot gold rose 2.3% to $1,745.66 an ounce, breaking the key $1,750 mark yesterday. U.S. gold futures also rose 2.3% to $1,760 an ounce, where they are traded now. Thus, we decided to open a buy signal for gold based on the 15-minute chart above.
Gold prices were up about 5% last week, and traders now believe there is a 71.5% chance of a 50 basis point rate hike at the December Fed meeting. A rate hike increases the opportunity cost of owning unhedged bullion, so expectations of a smaller rate hike are boosting sentiment.
“Along with the technical break above October highs, the likelihood of gold reaching $1,800 has become much more likely,” Hewson said, adding that trading is likely to remain volatile and the U.S. dollar could weaken further.
There will be many landmark meetings, key economic data, and relevant statistics this week. Therefore, traders should keep a close eye on everything that happens in the market.
Trading gold in Forex is highly complicated because there is practically no accurate information about this market in the public domain – no one can tell how much gold is on the market, where it is located, how much is offered for sale, etc. In trading this instrument traders rely on a lot of indirect factors, which precisely influence this asset’s market.
Also Read : Acer aspires seven a717-72g complete review.