Does Gold’s Downside Bottom Out or Just Start?| Influencer Forex Analysis•Jasper Lo

Prices of gold and silver saw a large retreat four weeks ago just after I published the Negative Points of Buffetts Buying Gold-Mining Stocks. Trends of precious metals are seemingly simple but yet proved to be tricky.

As of this writing (September 24), spot gold prices have fallen from the all-time high of $2,075.00 to $1,853.50, a decline of 10.67%. Such a drop stems mainly from the upbeat expectations of financial markets on the available coronavirus vaccine, which pushes economic activities back on track. With the economy seeing the start of a pick-up, central banks unwind the pressure on monetary easing, thus gold prices are punished. Besides, as over ten countries have been delivering their gold reserves back from the U.S. and U.K., I suppose some countries are likely to dishoard gold for more cash amid the high gold prices, so as to ease their financial pressure in outbreak response.

The recovered U.S. dollar, of course, is the last factor depressing gold prices. Apart from the changes in the Fed‘s monetary policies, which have sent a rally to the greenback, the Fed officials also stated that the country’s interest rates would have a chance to rise early, fueling further gains for the DXY to breach above the $94 barrier. Moreover, considering the DXY outshines others at the expense of GBP and EUR, all the non-USD currencies, gold, and silver have seen varying degrees of correction.

In terms of catching gold prices, investors are recommended to eye the dollar rather than indiscriminately focusing on other topics. With the U.S. stocks remaining weak recently, the U.S. dollar has bottomed out due to the RSI divergence, which becomes another key affecting the dollars trends. The trends on the chart show that the current DXY is expected to reclaim the $95.716 level, putting correction pressures on gold prices and non-USD currencies in the short run. From my estimate, gold may challenge a lower level of $1,765.00 this time while the silver is highly like to further decrease to $19.648.

[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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