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U.S. 10-year Yields’ Dive, Increasing Gold’s demand!
By: Ahura Chalki
Gold is printing new record high, day after day in past months. However, increasing from $1880 to $1940 needed real motivation, and the latest US-China tensions, after sharply increasing COVID-19 infected in more countries around the globe, was good enough to dash the hopes on faster recovery.
With raising the fears in the market, US 10 years Yields touching its lowest record (0.576) since last April. On the other hand, USD falling sharply which helps the other Safe-havens to have more demand. CHF and JPY raising more in past days, while the US stock markets also trading with more caution. Many analysts believe that raising the stock markets, rather than reflecting the good condition of the markets, reflecting the high liquidity, which has been pumped in the market as salaries or stimulate packages.
And finally, the lower interest rate flows the money in the market. When the confidence is low in other markets, Gold attract most part of that.
At the moment and for the next days, eyes mostly will be on FED meeting and the US jobless claim in the calendar, while US-China tensions and Coronaviruses headlines leading the markets.
Technically in all timeframes, more bullish remain and there is no exact signal of over bough or trend reversal, unless if in return Gold breach the 20 HMA, sitting on $1911. Also, profit booking and exit from long positions can do the same.
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