Gold prices fell from near-record levels in the previous session on Wednesday, as the dollar hit close to a 21-month high and investors took some profits. While some analysts predict new records for ounce gold, economist Hatice Kolçak comments on developments under grams. Market comments and recommendations from experts cryptocoin.com compiled for our readers.
“Yellow metal could make another move for ATH”
Spot gold was trading at $2,013.4, down 1.7% at the time of writing, after climbing $2,069.89 in the previous session. U.S. gold futures fell 1.05% to $2,021.8. Tiger Brokers Australia chief strategist Michael McCarthy describes gold’s recent rally as follows:
Any (record level) breakout will be a clear technical sign that the current supportive environment will push it higher. I expect very strong resistance at these levels.
The US dollar index held steady near a multi-month high, making the dollar-priced bullion more expensive for buyers of other currencies. Analysts warn that gold, traditionally considered a safe store of value during such global crises, could make another leap to an all-time high if Ukraine’s situation worsens amid current inflationary risk concerns.
“There is a significant amount of safe-haven purchases in the gold market”
DailyFX strategist Margaret Yang says gold prices have entered overbought territory and investors are looking for opportunities to make a profit this morning.
Gold pushed its rally to a record high on Tuesday as investors gave a head start for the traditional safe-haven metal amid growing fears around the Russia-Ukraine crisis as the US and UK said they would ban oil from Moscow. David Meger, metal trading director at High Ridge Futures, comments on the developments as follows:
The combination of roaring energy prices, grain prices and base metal prices culminated in dramatic inflationary pressures that continue to be the main support behind gold’s rise. We are also seeing significant safe-haven buying in the gold market as equity markets come under pressure due to major concerns on the geopolitical front.
Recommendations for gram gold from economist
Economist Hatice Kolçak, on the other hand, draws attention to the sharp movements in the market and warns dollar and gold investors of stagflation. The economist states that the rise in the dollar index (DXY) has crushed all currencies and the biggest danger expected in the world is Stagflation. Hatice Kolçak, drawing attention to the rise in DXY, makes the following assessment:
However, we have a slightly higher rise. In the light of the developments brought by the war, our country is ahead of other countries. The interventions made by the CBRT to the Dollar/TL rate continue. With the interventions, the exchange rate is kept. I believe the interventions will continue for a while. I don’t think there will be 17 TL or 18 TL. It may go to the 20s at once, but I think it will be suppressed by interventions.
Since ounce gold is priced in dollars, the increase in the dollar/TL rate causes the gram gold prices to increase. Since both the ounce prices and the Dollar/TL rate have increased recently, gram prices have increased with a double effect. Stating that the gram gold price is at a good point right now, Hatice Kolçak gives the following advice:
There are those who say whether to buy or sell from here. Long-term holders will continue to hold. In the short term, it seems that the tension will continue from today to tomorrow. If the war does not continue, a setback can be expected. If there are those who think that there may be an agreement and peace in the near future, they can take their positions accordingly.
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