Market Analysis

Recovery for the Gold?

GOLD

The weak recovery of gold over the last few days faces a fresh challenge with tomorrow’s Federal Reserve meeting. Investors are not looking for the current rate decision, which seems obvious, but instead for any monetary policy forecasts as they try to anticipate where interest rates will be in 2022 and 2023. These expectations are likely to have a significant impact on gold, as investors try to understand how real the risk of inflation is and what the likely reaction of the Fed will be. Gold is in a wait and see mode as a result.

A clear move above $1,740 would provide the first positive signal, while a new fall below $1,700 will put gold back in the danger zone. That said, we have so far seen that as soon as the price dips below that key threshold, buyers have sprung into life and provided support to the bullion price.

Carlo Alberto De Casa – Chief analyst, ActivTrades

 

EUROPEAN SHARES 
Stocks opened higher from London to Zurich on Tuesday following gains during the Asian session while US futures also climbed. This resurgence in risk appetite impacted on all sectors, with travel and leisure shares at the top of the board, as investors continue to anticipate a “back-to-normal life” situation. However, it is important to note that this trading stance appeared against a backdrop of rising uncertainty after most EU countries suspended AstraZeneca’s vaccine roll-out, which would typically have put pressure on stock prices. That said, the fact many investors are awaiting this week’s monetary decisions and press conferences from the Fed and other central banks, with no significant change expected, may help push riskier asset prices higher.

 

Technically speaking, the most interesting configuration comes from Zurich as the SMI-20 Index confirmed the bullish break-out of its bearish flag (dotted) with a 30 points wide bullish gap at the open. The market is now challenging the resistance zone at 10,890-10,910pts, the last one before the key 11,000pts threshold.

Pierre Veyret– Technical analyst, ActivTrades

Source: ActivTrader

 

The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication.

All information has been prepared by ActivTrades (“AT”). The information does not contain a record of AT’s prices or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of futures performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk.