GOLD weekly uptrend opportunity based On 1.00 Lot Calculation:
- GOLD AND SILVER RISE ON HIGHER INFLATION IN THE USA: US INFLATION (CPI) FOR APRIL AT THE HIGHEST SINCE 2008 (4.2% VS. 3.6% expected). Inflation has continued to rise, moved up by big stimulus packages provided by the US Federal Reserve and the US Congress. A rising inflation usually increases demand for gold and silver as those assets are traditionally considered a store of value, which tends to protect the purchasing power of people’s wealth amid higher inflation.
- FEDERAL RESERVE KEEPS SAYING THE HIGHER INFLATION IS TEMPORARY, SIGNALLING NO INTERVANTION ANY TIME SOON. The Fed is expected to keep interest rates unchanged close to 0.00% until the end of 2023. They are also expected to continue to purchase 120 billion dollars of bonds per month in 2021 (equivalent to 1.44 trillion dollars per year). Given current evidence of rising inflation in the US, the addition monetary stimulus could affect negatively the US dollar, while Silver and Gold prices could continue to rise. Fed is expected to meet next on June 16.
- US FISCAL STIMULUS TO CONTINUE TO RISE: US President Joseph Biden signed the $1.9 trillion stimulus into law on March 11. In December 2020, the U.S. Congress approved an $892 billion coronavirus aid package. Infrastructure bill that could be worth around 2 trillion dollars has been also discussed, while child care bill could be worth around 1.8 trillion dollars.
- CHINA (THE WOLRD’S BIGGEST CONSUMER) INCREASES GOLD BUYING (APRIL AND MAY): China has allowed international and domestic banks to import greater amounts of gold, Reuters reports. In recent weeks China has allowed large amounts of bullion to enter. Around 150 tonnes of gold worth $8.5 billion has been reported to head to China in April and May.
- JPMorgan SEES MONEY FLOWING FROM THE CRYPTO BACK INTO THE GOLD MARKETS: The bank said that big institutional players are leaving bitcoin for gold as bitcoin futures markets saw their steepest liquidation since October 2020.
- ANALYSTS OPINION (GOLDMAN SACHS/BANK OF AMERICA/CITIGROUP/WELLS FARGO/COMMERZBANK): GOLDMAN SACHS has a target price of $2000. BANK OF AMERICA 2021 estimate averages at $2063. CITIGROUP price target stands at 1950. WELLS FARGO sees Gold at $2100- $2200 in 2021. COMMERZBANK expected gold prices to return to $2000 by the end of the year.
GOLD, May 20, 2021
Current Price: 1869
|
GOLD |
Weekly |
|
Trend direction |
|
|
1980 |
|
|
1950 |
|
|
1910 |
|
|
1830 |
|
|
1807 |
|
|
1793 |
Example of calculation base on weekly trend direction for 1.00 Lot*
|
GOLD |
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|
Pivot Points |
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|
Profit or loss in $ |
11,100.00 |
8,100.00 |
4,100.00 |
-3,900.00 |
-6,200.00 |
-7,600.00 |
|
Profit or loss in €** |
9,100.52 |
6,640.92 |
3,361.45 |
-3,197.48 |
-5,083.18 |
-6,230.99 |
|
Profit or loss in £** |
7,852.57 |
5,730.25 |
2,900.50 |
-2,759.01 |
-4,386.12 |
-5,376.53 |
|
Profit or loss in C$** |
13,435.44 |
9,804.24 |
4,962.64 |
-4,720.56 |
-7,504.48 |
-9,199.04 |
* 1.00 lot is equivalent of 100 units
** Calculations for exchange rate used as of 9:00 (GMT+1) 20/05/2021
Fortrade recommends the use of Stop-Loss and Take-Profit, please speak to your Client Manager regarding their use.
*** You may wish to consider closing your position in profit, even if it is lower than suggested one
**** Trailing stop technique can protect the profit – Ask your Client Manager for more details