The price of Gold rises over the weekend. There’s a good reason for that. But first a quick look back at last week. While on Thursday and Friday the price of Gold was often around the $1,765 level, on Friday from 3 pm it suddenly plummeted to a low of $1,747.
Gold price briefly plummets on Friday
Because on Friday afternoon, bad news about the coronavirus were published again from important states in the USA. As a result, Stock prices fell sharply, and strangely enough, the Gold price fell in parallel. On Friday we asked directly whether this was a better opportunity for speculators to buy Gold. And yes, the price of Gold quickly jumped back up again from about 4 pm. And still on Friday evening the market could rise above 1,770 Dollars. The following chart shows the Gold price in US Dollars in blue since Friday morning, against the Dow Jones in red and green.
Gold in Risk Off Mode
Until this morning Gold has been able to maintain this increased level around the $ 1,770 mark with currently exactly $ 1,770. The market is currently in a small Risk-Off mode. The constant bad news from the US about ever higher corona figures is fuelling fears of a renewed slowdown in economic activity. Investors are consequently fleeing from risky investments such as Stocks, which automatically makes the safe haven of Gold more attractive. This scenario does not always work, but this time over the weekend it worked. The Dax has lost a good 250 points since Friday noon, the Dow Jones a good 600 points. Stocks down, Gold up.
Ipek Ozkardeskaya is currently saying that remaining risks in the global risk markets and falling government yields would continue to push capital into Gold. The price of Gold rose above the $1,770 mark on Monday after recovering from the $1,750 mark last Friday. The $1,750 level is now a crucial support for traders. The 50-day moving average ($1,722) should provide a solid safety net in case of an unexpected breach below this support, Ipek Ozkardeskaya said.