Investment money
The Future of Gold: An Analysis of Recent Trends and Geopolitical Factors
by Enda Trading Trader and YouTuber from Ireland.
Enda Trading 
Trader and YouTuber from...
The fluctuating gold market has left many investors wondering about the future of their investments. While the precious metal has come close to the $2,000 mark three times in the last three years, it has yet to hold above that level for an extended period. However, this time around, the outlook for gold seems to be slightly different.
Last year, gold's popularity among investors skyrocketed in response to unprecedented monetary and fiscal easing. When it hit the psychological benchmark of $2,000, the gold rally had increased by more than 70% from the cycle's low. The most aggressive phase of the rally came when gold surpassed a significant resistance level at $1,800, but the subsequent buying potential was quickly exhausted. As a result, despite the continued rally in other risky assets, gold saw a prolonged period of profit-taking after short positions were liquidated following its all-time high of $2,075.
In early 2022, gold demand surged on fears of capital depreciation and geopolitical instability, resulting in a 15% increase in less than five weeks. Despite failing to break new all-time highs, gold peaked at $2,072 before falling due to a decisive monetary policy reversal by the Fed and other central banks. Gold prices hit bottom in September-October, signaling that the Fed would slow the rate hikes and that interest rates could soon peak.
Gold rapidly returned to historical highs, outpacing other asset classes that bottomed out around the same time in 2022. Last month, the market saw a more solid reason to invest in gold as bank problems began to surface. Gold gained traction as the end of the tightening cycle approached, and the Fed shifted its policy towards easing in response to these economic growth issues.
Gold prices rallied sharply in March, and while the market possibly unwound this overheating in the recent 3% correction from the $2,048 highs, the sequence of lower highs in 2020, 2022, and 2023 is a cause for concern. However, the series of higher local lows over the past five weeks is an encouraging sign. Moreover, all this consolidation is taking place at higher levels than in previous similar episodes, indicating a stronger interest in buying gold.
Investors should also consider the historical tendency for the dollar to weaken at a similar stage in the monetary cycle. Geopolitical tensions further support the case for buying gold as a store of value.
In conclusion, gold's recent behavior suggests that the bull cycle is not over yet. While there are some concerns, the current outlook for gold seems positive, and investors should consider all these factors before making any investment decisions.
https://www.youtube.com/watch?v=guqbqG-cck0
Apr 28th 2023 00:22
Trader and YouTuber from...The fluctuating gold market has left many investors wondering about the future of their investments. While the precious metal has come close to the $2,000 mark three times in the last three years, it has yet to hold above that level for an extended period. However, this time around, the outlook for gold seems to be slightly different.
Last year, gold's popularity among investors skyrocketed in response to unprecedented monetary and fiscal easing. When it hit the psychological benchmark of $2,000, the gold rally had increased by more than 70% from the cycle's low. The most aggressive phase of the rally came when gold surpassed a significant resistance level at $1,800, but the subsequent buying potential was quickly exhausted. As a result, despite the continued rally in other risky assets, gold saw a prolonged period of profit-taking after short positions were liquidated following its all-time high of $2,075.
In early 2022, gold demand surged on fears of capital depreciation and geopolitical instability, resulting in a 15% increase in less than five weeks. Despite failing to break new all-time highs, gold peaked at $2,072 before falling due to a decisive monetary policy reversal by the Fed and other central banks. Gold prices hit bottom in September-October, signaling that the Fed would slow the rate hikes and that interest rates could soon peak.
Gold rapidly returned to historical highs, outpacing other asset classes that bottomed out around the same time in 2022. Last month, the market saw a more solid reason to invest in gold as bank problems began to surface. Gold gained traction as the end of the tightening cycle approached, and the Fed shifted its policy towards easing in response to these economic growth issues.
Gold prices rallied sharply in March, and while the market possibly unwound this overheating in the recent 3% correction from the $2,048 highs, the sequence of lower highs in 2020, 2022, and 2023 is a cause for concern. However, the series of higher local lows over the past five weeks is an encouraging sign. Moreover, all this consolidation is taking place at higher levels than in previous similar episodes, indicating a stronger interest in buying gold.
Investors should also consider the historical tendency for the dollar to weaken at a similar stage in the monetary cycle. Geopolitical tensions further support the case for buying gold as a store of value.
In conclusion, gold's recent behavior suggests that the bull cycle is not over yet. While there are some concerns, the current outlook for gold seems positive, and investors should consider all these factors before making any investment decisions.
https://www.youtube.com/watch?v=guqbqG-cck0Apr 28th 2023 00:22
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