Gold prices were under considerable pressure in last week’s trading as they failed to break through resistance levels of US $ 1,800 per ounce or approximately IDR 25.2 million per ounce (estimated exchange rate of US $ 14,000). Gold prices are still under great pressure this week due to some sentiment.
Philip Strible, chief market strategist at Blueline Futures, said pressure on gold prices was due to some sentiment, including expectations of capital and stock market risks from the US Central Bank and the Federal Reserve Board (FRB). Said it was caused by.
“Gold is experiencing a lot of resistance. The Fed is showing a rate hike next year. There is less talk, yields are rising and equity risk is back. Others such as cotton and copper. Commodity inflation is much higher. ” Kitco, Monday (October 18, 2021).
“Gold has a lot of resistance at $ 1,800, $ 1,805 and $ 1,815. The key level to maintain is $ 1,750. Once that price is exceeded, the price of gold will continue to fall to $ 1,720 and $ 1,685.” Stated.
Bert Merek, Head of Global Strategy at TD Securities, said much of the anxiety currently involving gold prices could be attributed to technological development. According to him, gold responded to the increase in retail sales.
“Importantly, technically, the price did not exceed $ 1,800. Gold was slightly above the 200-day moving average of $ 1,796, but could not be cleared. And it was re-to someone. I’ve given you permission to sell, “explains Merek.
“This is a combination of not convincingly above key levels of technology and a higher yield curve and higher 10-year yields. The US dollar has also jumped,” he added. rice field.
Meanwhile, based on the results of Kitco’s gold price survey, it shows the results of 13 participating analysts. Of these, the opinions are almost evenly divided. A total of 38.5% voted bullish, followed by 38.5% bearish and 23% neutral.
The main street side or market participants are more optimistic. Of the 1,425 individual investors who participated, 68% were optimistic. After that, 19% are bearish and 13% are neutral.
Competition with Bitcoin
Meanwhile, Bitcoin has reached a value of US $ 60,000, approaching a record high for the first time in six months, and gold continues to compete with cryptocurrencies as an inflation hedge.
“Bitcoin will get a lot of attention. Bitcoin will become a dagger on the gold side with more publicity. For gold to be good, it needs to grow,” explains Streible.
However, many analysts are very optimistic that gold can still compete despite the withdrawal of gold, noting that demand for gold will continue.
“It’s always difficult for gold to exceed $ 1,800. But this fall is a buying opportunity. Fear grows and many people want security. Usually, gold, cryptocurrencies and the Treasury are the goals. Gold prices will reach 1,800 in the north next week, which is based on inflation concerns and supply chain problems. ”
Haberkorn also said that gold will learn to coexist with Bitcoin.
“Bitcoin now looks brighter, but after all, gold is still gold,” said Harborcorn.
One of the biggest obstacles facing precious metals is the market expectation that the Federal Reserve will be more aggressive in reducing bond purchases and raising interest rates.
“Gold traders know there will be rate hikes, which is why prices have long been offered at less than $ 1,800, but future rate hikes will be minimized. US debt With everything in place, the federal government is not in a position to start. It will raise it significantly. It is aggressive about tariffs. “