Ichimoku Kinko Hyo CNH/JPY: The CNH/JPY pair is trading above the Kumo…
Gold: no motivation for an uptrend?
Information is not investment advice
With the news strains and the necessity of new lockdowns in many states, the virus is going bad in Europe – again. In the US, however, it looks comparatively stable – enough to let market observers get swayed by the prospects of a recovery that’s rolling all around. The latest NFP release that turned out better than expectations added to the optimism and investors turned away from gold.
Moreover, high US Treasury yields have been hammering the gold price to the downside lately. On top of that, there are cryptocurrencies now, with Bitcoin expected to reach hundreds of thousands of dollars in value over the next few years – which seems a plausible alternative to gold.
Together, these and other factors added up to make a solid reason for gold to stay in the downtrend and make new local lows. Will it change in the foreseeable future? It may. But so far, fundamentals are rather on a sideways-bearish side. At least, until the next US-China or another global geopolitical conflict erupts.
An almost direct-line downward diagonal of the 200-MA indicates that gold has been going down for quite some time already. Since summer 2020, to be precise. That means, for the last nine months, it’s been sliding down just to interrupt the downtrend by occasional upward incursions slightly above 50-MA and 100-MA. Very possible, we are now observing the same scenario. In this case, what is being formed now is a part of a fresh high that’ll see a downward reversal soon.
At the same time, the support of 1680 that was reinstated as such instead of getting broken last week suggests that the sideways pattern of the last three weeks may extend. Probably, this scenario should be taken as primary until bulls push gold to cross the resistance of $1755 – or drag it below $1680.
Last year was tough for the Japanese yen. USDJPY gained more than 30% over 2022, striking above 150 in October. While anticipation of slower Fed rate hikes pulled the pair below the 130 level at the start of 2023, the speculations over the destiny of BOJ’s yield control policy grabbed the attention of the Japanese assets in the middle of January. What lies ahead for traders of the Japanese yen?
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