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Original title: The life-saving golden straw is yet to be solved, the multiple key supports are facing severe tests, if the bulls cannot hold, they may panic.
FX168 Financial News (North America) News International spot gold continued to decline sharply on Tuesday (November 24), hitting a low of US $ 1801.37 per ounce, and the US $ 1800 mark was in jeopardy. It started testing key support below, that is, the 200-day moving average dropped to $ 1,796.35 per ounce, because this is very close to the 1800-integer mark. Close so the bulls are not expected to give up easily. The release of good news on the vaccine and improving economic data show us signs of decoupling between gold and stocks. Even if the dollar is still low, yellowGold priceGrid still cannot organize an effective counterattack. The key factor causing this situation is that, although the demand for hedging still exists, the most influential inflation risk may face suppression.
Although Trump did not admit defeat 20 days after the election, the Director of General Administration of the United States began providing federal resources for the transition of power. This move broke the deadlock in the transition of the US government and removed some uncertainties about the smooth transition. . This means that, in addition to obtaining the necessary funds, Biden’s team can also access government databases and contact federal agencies.
Additionally, there were reports Monday that Biden will select former Fed Chairman Yellen as the new Secretary of the Treasury. Deutsche Bank analysts believe that Yellen “may try to further unify fiscal and monetary policies” and quickly reverse the US Treasury’s intervention in credit facilities.
Saxo Bank’s John Hardy said: “We expect it to favor more easing policies, which should help the Fed’s agenda. As emergency spending increases, we can expect US Treasury yields to rise. “.
The emergence of these two main situations has effectively improved market risk sentiment, weakening safe gold buying to some extent. What we need to focus on now is how much Yellen will be introduced in the future if Yellen really does become the US secretary. Flexible policy, which will directly affect the inflation outlook, and this is also the most important driving factor for gold bulls in the near future.
Technically, the daily chart shows that the price of gold closed below the 61.8% Fib retracement level of 1836.16 on Monday, and the psychological barrier of $ 1,800 per ounce is expected to support the price of gold. If gold closes below this level, the shorts will challenge the 50% Fibonacci level of 1765.27, or even fall to the 50% to 38.2% retracement range, that is, the 1689.20-1765.27 range.
(Daily spot gold chart, source: FX168)
Panorama:
FXTM market analyst Han Tan said investors clearly believe that the arrival of the vaccine means the restart of the US economy. They have already planned to look ahead and believe that downside risks in the outlook for the market are limited.
IG Markets analyst Kyle Rodda said that if the transfer of power in the United States can go smoothly, then its economic recovery will also be better, which means that market risks will be lower. “The price of gold fell below the $ 1840 / oz support level to indicate that it will drop further to the 1,700 level before buyers re-enter the market.”
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