Singapore (5 August 2020) – Every dog has its day; today belongs to the die-hard gold bugs.
Following a convincing breach of the USD 2000-mark during New York trading hours, the path is cleared for spot gold to potentially head for the next target – USD 2500/oz, one chartist says.
The yellow metal which started rallying since mid 2018, traded to a high of USD 2019.40 Tuesday night in New York before giving back some of its gains. As at 0400 GMT Wednesday spot gold’s bid-ask was at USD 2014.30-2015.30/oz – live prices as reflected on kitco.com.
Fundamentally, the gold market continues to be supported by safe haven demand as a consequence of rising tensions between economic giants US-China, the resurgence of COVID-19 infections in the US and elsewhere in the world and central banks easy monetary policies translating into inflationary pressures.
Analysts at Goldman Sachs had on 28 July prior to the last night’s rally revised higher their forecasts on gold. Gold is now expected to hit USD 2300/oz in the next 12 months on rising concerns of the US dollar debasement, the investment bank said.
Elliot Wave Theory Points To Long Term Target Of USD 2500/Oz
Mukhriz Mangsor, an independent trader and a certified technician, applies the Elliot Wave Theory to forecast gold price.
Chart
“Using the potential formation of Wave 5 structure, it could reach the USD 2500/oz mark,” Mukhriz said. “But it may not go directly all the way (up) from the current price level to the USD 2500 mark. It will have some minor corrective moves,” before testing the target. Mukhriz said he uses the monthly chart to draw the Elliot Wave.
The time frame at which the market will hit the USD 2,500 mark is however difficult to predict.
Looking at the Ichimoku charting, spot gold could potentially hit USD 2,500/oz in the year 2022 -2023. Using technical indicators trend channel and angle, however, the market could potentially achieve that target only in the years 2025-2026, Mukhriz added.
Sani Hamid, Director in charge of Economy and Market Strategy with financial advisory firm Financial Alliance wrote in this news portal www.halaluniverse.net that gold will continue to be driven by negative real interest rates in the next 12 to 24 months. (https://www.halaluniverse.net/gold/gold-powers-on-what-drives-it/) The debasing of the US dollar will also support the yellow metal. (https://www.halaluniverse.net/gold/gold-a-multi-facet-asset-best-considered-as-currency/)
-/-www.halaluniverse.net
