Zhang Yaoxi: With heavy speeches and data coming, there is still a risk of gold falling sideways
Last trading day Tuesday (November 29): International gold/London gold rebounded and strengthened again. Although there was a small retracement at the end of the session, it still received a clear positive line, and it also verified that the situation will remain volatile in the near future.
In terms of trend, the price of gold recorded an intraday low of $1739.57 immediately after the opening of the Asian market at $1740.35 per ounce, then rebounded and continued to record an intraday high of $1758.90 at the close of the Asian market, and then opened directly in the European market. In this regard, the performance encountered obstacles and operated under pressure;
In the early hours of the U.S. market, the amplitude and frequency increased. After a few degrees of volatility of 10 dollars, it was still under pressure. It closed at 1749.56 US dollars, with a daily amplitude of 19.33 US dollars, and closed up 9.21 US dollars, an increase of 0.53%.
In terms of impact, the U.S. dollar index and the yield of U.S. bonds first fell and then rose, causing the price of gold to rise first and then fall back. However, due to the domestic turmoil in China, there has been an increase in some safe-haven demand, and the reduction in interest rate hikes by the Federal Reserve in the future Affected by the hopes, the gold price still maintained its rebound momentum and closed positive.
Looking forward to today’s Wednesday (November 30): International gold opened relatively strong, and the opening momentum of the U.S. dollar index and U.S. bond yields weakened, which supported it. However, according to the U.S. dollar index bottoming out for two consecutive days, U.S. bond yields In the short term, the interest rate also tends to bottom out. Both of them have a demand for further rebound, which will put pressure on the gold price. Therefore, the gold price as a whole is more likely to remain volatile.
During the day, we will focus on data such as the number of ADP employment in the United States in November (10,000 people), the revised value of the annualized quarterly rate of real GDP in the third quarter of the United States, the Chicago PMI in November in the United States, and the monthly rate of the contracted sales index of existing homes in October in the United States. In addition, other data expectations are generally negative for gold prices. According to yesterday’s data, it is basically better than expected, or maintains the previous value.
During the white market, we still pay attention to the strength of the rebound first, and wait to see the room for a fall in the evening. Yesterday’s trend is opposite to the day before, and the verification is valid. Today’s trend and price look similar to yesterday’s, which is worth referring to.
However, the key point is to pay attention to the fact that Federal Reserve Governor Lisa Cook delivered a speech on the outlook for the economy and monetary policy at 01:35 am the next day at the end of the U.S. session. And at 02:30 the next morning, Federal Reserve Chairman Powell delivered a speech on the US economic outlook and the job market. And at 03:00 the Federal Reserve announced the Beige Book on economic conditions.
At that time, according to the information of its performance, whether it is dove or hawk will directly affect the trend of gold prices. It is currently expected that Powell will maintain his last remarks and continue to downplay the importance of slowing down the pace of interest rate hikes. He also said that interest rates may have to be raised higher than previously planned. A higher peak will put significant pressure on the price of gold, and it will also put pressure on the price of gold until the interest rate hike in December. On the contrary, it will rise sharply.
Fundamentally, investors now see the dawn of an end to interest rate hikes as most of the Fed’s interest rate hikes have been priced in. In addition, investors are also looking forward to the Fed peaking interest rates early next year, when inflationary pressures are expected to subside. This also strengthened the market’s bullish confidence.
In the long run, even if interest rates are raised by 75 basis points in December, or follow the peak of 7% given by a Fed official as scheduled, and inflation returns to 8%, the pressure on gold prices will be limited. The pressure to raise interest rates has also become more limited and weakened, and most of the interest rate hikes have been digested by the market, and the gold market will no longer be shrouded in the cloud of interest rate hikes. Even if inflation rises again, it also shows that the Fed’s interest rate hike is not effective, and it will also increase the risk of recession, which is also good for gold prices.
Therefore, while we maintain the view of short-term callback correction and shock bottoming, we still need to wait for the Fed’s hawkish tone to reach its peak, and when the end of interest rate hike is in sight, we will look at the sustained recovery mode. In terms of time node, individuals still expect it to be after the first quarter of 2023.
Technically: at the level of the monthly chart, the price of gold has risen sharply this month. It once rebounded from the low point of 1616.49 US dollars, reaching a peak of 1785.91 US dollars, with an amplitude of nearly 170 US dollars. In terms of range, it is still not enough, and the trend of gold price is still above the moving average in May and the high point of the previous two months. There is a signal that the profit is exhausted, and the monthly line will be collected today, and there is a high probability that this view will remain unchanged.
Even if the momentum of the rebound in the market outlook weakens, or there are negative factors, the risk probability of falling back and refreshing the low point is extremely small, and it will remain at the current relatively low level to build a bottom and oscillate, waiting for another strengthening.
Weekly level: The price of gold hit a high and fell last week, bottomed out last week, and the short-term strength of long and short has been exhausted or wait-and-see. This week’s trend also remains volatile, but it still runs above the 5-week moving average, which strengthens the market outlook Continue to look at the expectation of a rebound, and given that the current trend is still running above the average line of the middle rail, this implies that the recent resistance and fall is still a correction of the callback line. Even if it falls again and intensifies, it is expected to test the middle rail or 200 The support position of the weekly moving average bottomed out, and rebounded and strengthened again.
At the top, we will still focus on the target resistance near the 100-week moving average, which can be seen falling for the first time. Below, we will still pay attention to the support of the 5-week moving average and the mid-rail support situation, which can see a rebound for the first time.
Daily line level: The price of gold has remained oscillating above the middle rail recently. The bullish signal of the indicators in the attached picture has a tendency to strengthen again, and the Bollinger Bands have also shrunk. Below we still focus on the support near the middle rail, while above we focus on the current high resistance this week and further resistance after the breakthrough. In terms of operation, treat it as a shock and wait for it to strengthen.
Intraday preliminary point reference:
International Gold: Focus on support near $1744 and $1738 below; focus on resistance near $1758 and $1765 above;
Spot silver: Focus on the support of $21.15 and $20.95 below; focus on the resistance of $21.60 and $21.85 above;
Gold TD=(international gold price x exchange rate)/31.1035
International gold fluctuates by 1 US dollar, and gold TD fluctuates by about 0.22 yuan (in theory).
U.S. futures gold price = London spot price × (1 + gold swap rate × futures expiration days / 365)
Predict boldly, trade cautiously. The above viewpoints and analysis only represent the author’s personal thinking, and are for reference only, not as a basis for trading. your money your decision.
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