With the increasing uncertain conditions in world economies from the USA to the Asia, the gold market started to remember its “safe harbor” specialty during the month of April. When we look at the general perspective of the gold market, we can see a positive trend in April. The starting price was at 1.251 USD at the beginning of April. Then, the parity started to give strong positive signals. There were a lot of reasons for the increase. First of all, the military intervention provided to changing people’s preferences from risky assets to less – risky assets in the global forex market. The latest developments of Fed meeting and OPEC’s decision about oil production were the other issues that provided increase on gold prices.
The gold price reached 1.293 USD level on April 17 which was the highest level of the month. After this date, the gold price has continued its horizontal trend, but the general outlook was so positive. The withdrawal we followed with the decline in global risks and the Dollar Index trying to recover from scratch, prices moved to 1290-1280. Although a slight increase in the dollar and real interest rates caused a downward pressure on gold, global demand for geopolitical concerns to increase the risk perception remains a safe haven. The tension in North Korea led to the reinforcement of the perception of risk as the further climb of Russia with the union of North Korea border. Despite the possibility of a short-term downward correction in gold prices during the past few days, the support given by geopolitical tensions is influencing the narrow band of gold.
Finally, the first forecasts of the Gold market will be positive for the first days of May. The resistance levels will be 1.320 and 1.340 USD level in the upward direction. On the other hand, if we experience a negative trend, the support levels will be 1.278 and 1.285 USD.
- Date: 26 April 2017 Wed 06:42
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