2020-10-02

Gold rose more than fell during China’s National Day holiday! Geo-risk and fiscal stimulus stalemate are double blessings. The bulls work hard to regain the key.

By yqqlm yqqlm

FX168 Financial News (North America) News International spot gold rebounded strongly on Thursday (October 1), hitting an intraday high of $1,908.90 per ounce, returning to above the $1,900 mark, despite economic data It shows that the U.S. economy is still recovering, but the market’s concerns about the deadlock in the U.S. fiscal stimulus plan and the existence of geo-risks have given gold an effective support. On the other hand, China ushered in the 8-day long holiday of Mid-Autumn Festival and National Day. During the National Day, gold has a higher probability of rising. It has appeared 5 times in the past 7 years, with the largest increase of 2.74%and the largest decrease of 4.63%. At the same time, the probability of gold rising after the long holiday is also greater, so the buying confidence of the bulls has increased.

According to DataTalks intercepting the performance of gold from the opening of the 7th trading day to the opening of the 20th trading day in October in the past 7 years, the results show that the probability of gold rising during this period reached 71.43%, and the rate of increase Significantly higher than the decline, the largest increase was 3.71%.

The United States released a series of economic data during the day, indicating that the U.S. economy has continued to recover, but economists questioned its follow-up momentum and the prospects for recovery under the continued COVID-19 epidemic. Of particular concern is the number of initial jobless claims. This seems to be the prelude to the highlight of the week before the more important non-agricultural report is released on Friday.

According to data released today, there were approximately 837,000 new initial unemployment claims across the United States last week, a decrease from 873,000 in the previous 7 days, but it still means that the United States is unemployed. There are more people than in any week before the outbreak of COVID-19.

Charles Schwab UK managing director Richard Flynn (Richard Flynn) said that today’s U.S. unemployment report shows that the recovery is small:“The decline in the number of initial jobless claims today shows that the labor market It has improved, but without extended supplementary unemployment benefits, the prospects for broader economic recovery and US GDP growth are still very uncertain.”

On the other hand, EU sources said that in this week In crucial trade negotiations, Britain and the European Union failed to resolve their differences on state aid issues. After the British House of Commons passed the”Internal Market Bill” by a vote of 340 to 256 on Tuesday, the bill will be passed to the House of Lords for debate. Johnson’s Conservative Party does not hold a majority in the House of Lords. According to people familiar with the matter, ministers expect the upper house to slam the bill. This bill was accused of violating the content of the Brexit agreement, which attracted strong dissatisfaction from the European Union.

At the same time, on September 30, local time, the U.S. House of Representatives passed the Uyghur Forced Labor Disclosure Act with 235 votes in favor and 163 votes against it. The US House of Representatives passed the second bill on the issue of forced labor in Xinjiang in two weeks. The Associated Press analyzed that if these two proposals become laws, they may have a major chain reaction in global trade, forcing companies to avoid the Xinjiang region, which accounts for 80%of China’s cotton production, and Xinjiang is still tomato and processed products. An important production base for products.

The continued outbreak of these geo-risk events has kept the market safe-haven buying strong, and the support below the gold price is expected to be stable.

From a technical perspective, Economies.com said that if the price of gold exceeds $1,901.80 per ounce, this will push the price of gold to rise further, and the first target is aimed at the area of ​​$1911.00 per ounce. However, if the price of gold stays below US$1,901.80/oz to consolidate, this will make the bearish scenario still valid. It is expected to test the main target of US$1877.00/oz. Once it falls below $1877.00/ounce, the price of gold may test the next bearish target of $1,690.90/ounce.

getInterUrl?uicrIvZQ=d6019018e3cb60bf472d1545bfe44e78 - Gold rose more than fell during China's National Day holiday! Geo-risk and fiscal stimulus stalemate are double blessings. The bulls work hard to regain the key.

(Spot gold daily chart, source:FX168)

Market outlook:

Michael, Chief Trader of US Global Investors Matousek said:”The positive side of gold is that uncertainty increases and more people want to hold gold. In addition, some policies seem likely to continue, such as global low and negative interest rates.”

Capital Macro Assistant Commodity Economist Samuel Burman said in the report that they now expect the price of gold to reach US$2,000 per ounce by the end of this year and US$2100 per ounce by the end of 2021. The new year-end target is higher than the previous estimate of US$1,900 per ounce. Burman said:”We believe that as the actual yield drops slightly, gold prices will continue to rise until the end of 2021.”