Gold holds firm in positive territories, investment demand to grow in 2020


  • Gold is sitting in bullish territory due to safe-haven investment.
  • Coronavirus is in the driver's seat, but analysts still expect that investment demand for the yellow metal will grow in 2020.

The price of gold is firm and higher by 0.67% on the day so far, having travelled from a low of $1,556.60 to a high of $1,578.30. Worries with the coronavirus taking a turn for the worse on Wednesday night, following the announcements by the Chinese health officials in the Hubei province reporting 242 new deaths and 14,840 new cases of the flu-like virus, dented risk appetite. 

The worldwide death toll is up to at least 1,357 and the number of confirmed cases to more than 60,000. The uncertainty of the situation is supporting safe-haven asset classes due to the economic ramifications that a full breakout into a pandemic would have on the global economy. However, considering the means in which the Chinese health officials have changed the method of diagnosing cases of the illness and as such, there was a sevenfold increase in the number of new cases of the virus, based on a new diagnostic protocol, according to China’s National Health Commission.

Investment demand for the yellow metal to grow in 2020

Analysts at TD Securities explained that gold is a crowded trade, although the marginal day-to-day flow appears to be driven by the change in risk sentiment as it relates to safe-haven demand.

"The bull market narrative is widely acknowledged, which translates to an above-average number of traders holding a long position, although the average trader's position size is not excessive. But, when periods of haven buying drive prices to the upper-bound of the recent range, the position sizing per trader becomes more of a worry, making short term shakeouts a more prominent risk."

The analysts still expect that investment demand for the yellow metal will grow in 2020, as asymmetry from the Fed and the suppression of real rates across the globe will keep the gold bug alive. "That being said, we expect only marginal flows from CTAs as algorithmic trend followers remain well-positioned for the precious metal bull market."

Gold levels

XAU/USD

Overview
Today last price 1576.39
Today Daily Change 9.13
Today Daily Change % 0.58
Today daily open 1567.26
 
Trends
Daily SMA20 1567.56
Daily SMA50 1532.23
Daily SMA100 1507.63
Daily SMA200 1463.44
 
Levels
Previous Daily High 1570.52
Previous Daily Low 1561.99
Previous Weekly High 1594.01
Previous Weekly Low 1547.56
Previous Monthly High 1611.53
Previous Monthly Low 1517.1
Daily Fibonacci 38.2% 1565.25
Daily Fibonacci 61.8% 1567.26
Daily Pivot Point S1 1562.66
Daily Pivot Point S2 1558.06
Daily Pivot Point S3 1554.13
Daily Pivot Point R1 1571.19
Daily Pivot Point R2 1575.12
Daily Pivot Point R3 1579.72

 

 

 

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

GBP/USD hits three-month highs amid Brexit hopes

GBP/USD is rising toward 1.3450, the highest since September, shrugging off Brexit concerns. France may reportedly veto a deal if it sees too many compromises from the EU. The final US Services PMI, vaccine developments and US data are all awaited. 

GBP/USD News

EUR/USD resumes advance, reaches fresh highs

The EUR/USD pair is firmly advancing beyond 1.2100, trading at levels that were last seen in April 2018. The dollar is under pressure amid hopes for US fiscal stimulus and an upcoming vaccine. Investors are shrugging off Germany's extended restrictions.

EUR/USD News

XAU/USD climbs to multi-day tops, just above $1840 level

Gold edged higher through the early European session and climbed to eight-day tops, around the $1845 region in the last hour.

Gold news

US Initial Jobless Claims Preview: What was old is new again

Jobless claims are again at the center of concerns about the US labor market and by extension the economic recovery. A increase of 67,000 in the last two reporting weeks is assumed to come from the new business restrictions in states with rising COVID-19 counts.

Read more

Extra week of Black Friday!

Learn to trade with the best! Don't miss the most experienced traders and speakers in FXStreet Premium webinars. Also if you are a Premium member you can get real-time FXS Signals and receive daily market analysis with the best forex insights!

More info

Forex MAJORS

Cryptocurrencies

Signatures