Gold prices retreated below $1,862 after hitting the record high of $2,074.92 on August 6, which is

Gold prices retreated below $1,862 after hitting the record high of $2,074.92 on August 6, which is because traders have widely dumped their long position in the fear of the declining risk aversion considering Russia has successfully registered the COVID-19 vaccine. Thereafter, bargain hunting spurred gold to reclaim the ground of $2,000, but the resistance ahead of $2,015.61 hampered gold again and took a toll over $100. Whether gold will regain its shine and register another record high has become the talking points across financial markets.

Traders actually have kept an eye out for opportunities to liquidate their position at a profit after noticing the sharp rise in gold prices. The reason lies in the purpose of gold purchase. Traders buy gold not for long-term holding, but simply for profiting. Once the trading prices appeal to them, they will sell out for bumper profits and wait to buy on dips after the next slump.

In fact, financial markets have definitely achieve a consensus that various vaccines from countries worldwide will be available in the short term, which will certainly accelerate the recovery in global economics and weaken the risk aversion. Under such condition, the central banks of various countries may reduce or even suspend the quantitative easing.

The U.S. dollar index, the largest influencing factor of gold prices, has also shown a rebound mainly because the European Central Bank Minutes showed that its monetary policy is more dovish than that of the FED with a cascade of PMI data much worse than that in the U.S. As a result, the Eurozone is obviously the weaker one in the comparison of the economic and monetary policies of the two areas, which may cause a steep rebound in DXY and then suppress gold prices. As DXY sees its most critical resistance at the level of 94, a breach above there will negatively impact gold prices, pushing them to break through the support level of $1,862 and move forward to another significant one of $1,765.

[About The Author]

Since 1987, Jasper Lo has been engaged in the financial industry

(forex, futures and gold) for more than 32 years and holds forex R.O.,

securities and futures broker licenses. Mr Lo is an expert in trading

forex, precious metals and commodity futures and an basic and technical

analyst.

Over the years, Mr Lo won many individual and team sales champion

awards, as well as outstanding employee awards. He was invited, as a

guest mentor, to the University of Hong Kong, Guangdong Ocean University

and Guangzhou Jinan University. And he was also appointed as the chief

training consultant by Hantang Securities and Dongguan Securities in

China.

Mr Los experience as guest of honor invited by media including Chinese and English newspapers and columnist:

-Guest of honor invited by TVB New Channels such as Finance Channel, Forex Focus, Global Watch

-Guest of honor invited by Now Finance Channel - Forex Reports

-Guest of honor invited by i-CABLE Finance Info Channel - Forex Opportunities

-Guest of honor invited by ViuTV - Investor Smarter Group

-Columnist of Finance and Forex Market of Ming Pao

-Presenter of Finance and Forex Forecast of Ming Pao

-Presenter of Investment 36 Stratagem and Technical Analysis in 1 Min of Ming Bao Finance

-Appointed lecturer of Ming Pao Investment Seminar and Paid Course

-Author of the best seller Investment 36 Stratagem

-Columnist of Forex Expert, Forex Analyst, Marathon Weekly of ET Net

-Guest of honor of Open Good Morning of ET Net

-Guest of honor of Metro Finance Channel - Market Opening, Instant

Market Fighting, Guangdong-Hong Kong Finance, Finances Power, Market

Analysis

-Guest of honor of New Era of Investment of RTHK

-Columnist of Capital Commodities of Capital Weekly

-Guest Presenter of Wang Guanyi Online Finance Channel - Fund and Commercial Bond

-Columnist of Wealthub Finance and Investment Smart Platform of Enrich Culture

-Guest presenter of Weekly Investment in the World of Enrich Culture

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