Gold trade analysis
Spot gold hit a new all-time high of $2,222 in early Asian trading, before falling back slightly to around $2,200. This rally was supported by the Federal Reserve's expectation of maintaining three interest rate cuts.
A slight decline in the dollar and U.S. Treasury yields pushed gold prices to record highs. As interest rates fall, the opportunity cost of holding non-yielding gold decreases, which puts pressure on the U.S. dollar and attracts investors holding other currencies.
Gold prices are currently showing a good upward trend, mainly affected by the boost of inflation expectations and the decline of nominal interest rates. The Federal Reserve's dovish stance has put some pressure on existing short sellers, and at the same time attracted some chasing orders, driving up the price of gold.
With three rate cuts likely this year, bond yields and the dollar have fallen, creating favorable conditions for gold prices to rise. In addition, the U.S. dollar also fell to a one-week low against other currencies, and the U.S. 10-year Treasury bond yield also trended downward.
The target range for spot gold in the second quarter is US$2,443 to US$2,552
Spot gold may test the resistance level of $2,268 per ounce next quarter, and is likely to break through this level and rise to the $2,443-2,552 range.
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At the end of the Asian market on Friday (March 22), spot gold maintained its intraday correction trend. The current price of gold is around US$2,165 per ounce; the price of gold has dropped by nearly US$50 from the historical high hit yesterday.Gold prices have seen some bearish pullbacks, and if the price falls below $2,166.30 per ounce, the outlook for gold prices will turn bearish.
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