Gold is having one hell of a run!

Tuesday, 25th June 2019 11:26 - by Rajan Dhall

First of all well done to all those that are holding gold-related stocks at the moment. We have seen good moves in the likes of Fresnillo in recent times off the back of the latest gold run. 

So looking at the weekly technicals for gold and I have seen an important level that could get some attention in the coming months. 

There is an area that was used as support in and around 2012 close to the $1523/oz region that could be the point where traders might see some resistance. I remember trading around this time and it was a strong exhaustion point for the retracement down and 3 strong bounces later it finally gave way and the price capitulated below $1100/oz. 

Now as geopolitical risks hit the market and other traditional safe havens lose their appeal, gold has come back with a bang and may head toward the $1500/oz level in the coming months. US government yields have come off heavily as central banks around the world switch stance to an easing bias. Corporate debt yields are also falling as central banks offer cheaper money. Gold seems to be the flavour of the month. 

Once scenario may throw a spanner in the works and that is the agreement of a deal between the US and China. Trump and Xi are set to meet in Japan on Friday and any potential agreement could send money flowing away from the precious metal back into stock. So although the outlook is bullish at present there is a strong variable in the horizon. 

The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.