Is Gold Ripped For Higher Moves ?

Gold Forecast

Gold prices crashed after making highs of 2075$ last year. This year gold tested 1670$ and bounced back after making a good double bottom. Currently gold price trading at 1780$. So are we ripped for new higher moves in upcoming weeks or we will crash again to test new lows in upcoming weeks ? Lets find out.

Interestingly Unemployment rate is crashing fast and its down from double digit to respected 6% in March. US also adding enough number of jobs which is a good sign for economy. However US bond yield is what causing worry despite Fed’s assurance that they wont increase interest rate before 2023.

US bond yield is still rising with steady pace. Fed already suggested that even if US economy recovers completely they will not raise interest rate which is nearly zero now.

Since pandemic started US gave several relief package which resulted in mounting debt. US debt is highest since world war II and its going to rise even more as president biden prepares for infrastructure bill now. Rising debt could hamper US growth which could literally limit no growth at all for several years. We need to asses the situation once US economy reaches pre covid levels in upcoming months years.

Before April 2021 we thought corona virus pandemic is almost over. That is when India hit by second wave of corona virus and recording more than 300K new infections every day. Despite two vaccines available in country world’s 5th largest economy is struggling to keep infections in control. This resulted in partial lockdown in country which could further hamper growth of India.

India is also 5th largest economy and it could send tremor to other part of the world as well. Almost every central bank of world awarded stimulus package to their goverments which distributed to businesses and people to cope up with devastating lockdowns which resulted in major business loss.

We are far from over and stimulus package debt could come to haunt us soon, which will be a positive for gold. Interestingly gold entered in positive zone on charts as well.

Currently gold is trading at 1780$. Good support in gold price stands at 1720$. If traders breaks and close below 1720$ then expect xauusd to test upto 1670$ – 1620$ very soon.

Good resistance in gold chart stands at 1830$. If traders break and close above 1830$ then expect gold prices to hit further upto 1870$ – 1900$.

Conclusion: Rising debts and technical chart suggest gold is ripped for new higher moves. So plan accordingly.

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Improving Unemployment Rate May Pressure Gold

Gold Trend

US unemployment rate improved from 6.7% to 6.3% while corona virus cases surged ahead in last month. President Biden proposed $1.9 Trillion package and it seems he wont have any problem passing this stimulus package as democrats have good numbers now.

Last week Trump impeachment trial started which resulted in acquittal. It was not a surprise as Trump needed 2/3 majority to impeach. It seem Trump made a cult following in republican party which didn’t let him impeach second time. Now he may be able to contest for office in 2024.

Improving unemployment rate and good job numbers seems a good factor to count for gold prices now. We now have vaccine and corona virus risk seems to be minimum. Vaccine works on new strain of UK virus too. So i dont think there should be any major concern regarding corona virus lockdowns and economies. Except few European countries whole world is opening its economies and we are seeing good come back in all economies around the world. This should be sufficient to conclude that we may not see new lifetime high of gold this year.

However If some problems in vaccine or some new event occurs in world then we may see gold firing again and testing new lifetime highs.

One issue is still not clear is how world will react to its new mounting debt. Every single country had to bailout or gave stimulus package to revive its economy. Now how economies will react to this new mountain of debt will be very interesting. Many countries may raise tax or arrange some payment which could trigger uncertainty and this may result in rising gold prices. Rising debt is only reason as of now which may send gold buyers into frenzy.

Conclusion: This new year 2021 may prove to be a flat for gold traders. We may not see major movement like we seen in 2020 from 1450 to 2076$ this year. However as of now bears have everything under control.

Technically gold needs to break 1920-25$ and need to close above these levels in order to resume its bull run. A break and close below 1760-50$ may send bulls into further shock and we may see deeper cuts in gold prices.

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US Job Numbers & Power Transition Will be Crucial for Gold

Power Transition & US Job Numbers

Yesterday Trump supporters rioted in Washington DC & Entered in Capitol Hill Building illegally. Four rioters died while more than 50 injured. Trump supporters tried to enter in Capitol Hill to reverse Joe Biden win as House was about to certify Joe Biden’s Presidency. Trump supporters interrupted the proceeding while injuring many policemen and staff. America seen its one of the darkest day as Capitol Hill was breached after 1812.

After Capitol Hill episode all social media networks banned President Trump’s account. Today he sent a video message condemning his own supporters and declared there will be a smooth power transition to Joe Biden. Even though he said there will be smooth transition. One more rally is scheduled at 19th January by Trump supporters.

Today US will declare Non farm payroll & Unemployment numbers which will be a major factor for gold price today & for upcoming weeks. This week labor department released advance non farm numbers which gave a shock to market as market was expecting 60K jobs but numbers came 123K.

Today we will see actual non farm payroll which came 245K last month. Currently market is expecting non farm from 60K to 80K. If non farm payroll comes under 50K then we may see good rise in gold prices. However above 80-100K numbers may pressure gold today and in upcoming weeks too.

Unemployment rate was at 6.7% last month. Current expectations are between 6.5% to 6.9%. If unemployment rate slips below 6.4% then we may see good crash in gold. However if unemployment rate goes above 7-7.1% then we may see a good rise in gold price today & in upcoming weeks.

Joe Biden will be US president in 2 weeks from now. He is a democrat, he already hinted that President office will not be same anymore. We need to observe what major decisions he take or what major decisions he reverse in his presidency.

Currently gold is trading at 1909$. I gave a sell signal to my paid subscribers at 1938$ this Wednesday. Current support in gold chart stands at 1898$. If trader breach below 1898$ and manage to close below 1898$ then we may see good weakness in upcoming weeks.

If gold breaks above 1930$ and manage to close above 1930$ then we may see good buying in upcoming weeks.

Conclusion: Even though market is stable compare to march now, We have job numbers and power transition ahead this month. So stay cautious and make sure you follow strict stop loss in trades.

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Vaccine progress diffused gold buyers. Now what ?

Vaccine diffused gold buyers

From August’s high of 2074$ spot gold price crashed till 1761$. A sweet 15% cut in gold price from August till November. Main reason behind this 15% cut is vaccine progress and continuous decline in jobless numbers around the world. Pfizer, Moderna, and many other pharmaceuticals have announced their vaccine are 92-95% effective to prevent corona virus. Yesterday Moderna already requested clearance for its coronavirus vaccine in the US & Europe.

Gold fired from March’s low 1450$ to 2074$ in August. It took less than 4 months to clock 40% gains in gold prices. It took nearly 3 months to correct 15% from August high. US unemployment rate is also falling which is pressuring gold prices. In September Unemployment rate was 7.7% while in October Unemployment rate was 6.9%. From double digit to nearly Pre covid levels of 5% unemployment rate in less than 6 months.

Economies are also going back to pre covid levels and even equity markets are testing new lifetime highs. After vaccine news Dow Jones & other US indices tested new lifetime highs which made sure gold price fall further. Dollar Index also showing good strength in order to weaken the gold prices.

US elections concluded and finally Joe Biden has won which is another check box in gold price list. US election was an uncertainty which was driving gold prices higher since July. Trump was reluctant to give power to Joe Biden and alleged elections fraud after election result. But last week he also almost conceded which gave equity a push that power transition will be smooth. Another bad sign for gold as power transition uncertainty ends there.

Gold last hope was stimulus package as Trump suggested he will look into it after elections are over. Its been nearly 1 month and there is no talk of stimulus. I feel we will see some stimulus package when Joe Biden enters in office. That could be a push which may send gold price roaring again.

For now gold price has entered in weak zone and continuing its dry run. Gold resistance stands at 1860$. If trader breaks and manage to close above this level. Then expect good rise in gold upto 1900$ – 1950$ once again.

Gold support stands at 1745$. If trader break and manage to close below this level. Then expect further correction in gold upto 1700$ – 1650$.

Conclusion: Current gold suggests further weakness unless there is some news. So avoid going for buy till market is not closing above 1860$.

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Reverse claims may give shock to gold sellers

Rising Unemployment claims is concern

I wrote an article last month when gold was trading around 1950$. I mentioned declining unemployment claims may cause gold decline. Gold price tested 1840$ after my article. A sweet 110$ crash from 1950$. Last week US unemployment claims rose from 845K previous to 898K. Forecast was 810K.

Unemployment claims are up more than 50K in a week. More than 50,000 americans applied for unemployment claims compared to last week. This could be a saturation point in claims decline. If claims kept rising then we may also see rise in unemployment rate. Rising unemployment rate will pressure fed to push more liquidity into economy and we may see more side effects soon.

US govt & FOMC has pushed major money in economies. US budget deficit record $3 trillion+ during fiscal 2020. US economy may need more stimulus package to avoid major collapse. Congress & Senate talking about another stimulus package but its still hanging in between as president Trump kept changing stance.

Rising unemployment rate + More uncertainty towards stimulus package & election’s volatility may fuel gold prices higher. So keep an eye if you are in sell side.

I will asses this week’s unemployment numbers and will post an update on my youtube channels. You can watch daily gold analysis on my youtube channels. Join here for English. Join here for Hindi. However a major rise in unemployment claims may put numbers in million range again.

We are near 900K and one more push towards million could put all plans of revival on hold. US govt may need to push interest rate zero or below zero in order to survive the economy as govt cant keep giving stimulus package forever. US already has highest fiscal deficit since world war 2.

Currently gold prices are trading at 1909$. Good resistance in gold chart stands at 1960$. This is also a trend reversal level. If buyers break and manage to close above this level. Then expect buyers to take charge and gold may test upto 2000$ – 2060$ in short term.

Good support in gold chart stands at 1840$. If trader breaks and manage to close below 1840$. Then we may see good red in gold upto 1800$- 1740$.

Conclusion: Technically gold chart is in weak territory. But fundamentals reasons may be changing. So keep an eye on claims & unemployment rate.

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Declining Unemployment claims may crash gold ?

Declining Unemployment claims

 

US reporting decline in unemployment claims since few weeks. Last week US unemployment claims to 860K from 893K previous. We are seeing a declining curve in jobless claims which is a very good sign for US economy. Less people are filing for jobless benefits which means many people are returning to jobs and economy is on track.

Even unemployment rate crashed from 10.2% in July to 8.4%. We have entered in single digit in unemployment rate and even if US unemployment stick here, it will be a very good sign for economy. Declining unemployment rate is a green sign for US economy and it could hamper historic bull run in upcoming weeks.

Currently gold price is trading higher as uncertainty of covid-19 is still playing in market. No vaccine on site and rising corona virus cases keeping gold from crash despite declining unemployment rate & rising economies around the world. Few weeks back Nasdaq & S&P500 index hit fresh lifetime highs and yet gold remain stable without major crash.

Current euphoria in gold price seems to subside and market may be in consolidation period, Gold investors and traders could be waiting for even clear signal. Currently uncertainty of US elections & deteriorating US-China relations are in play which is keeping gold prices higher.

After US elections in November we should see more clear path for gold price. No matter who is elected president after November , market uncertainty will be over by November end and I believe US-China’s relation could be better by the end of this year.

Next we have to see how much aftermath we will see in post covid world. Fed spend trillions of dollar in order to support US economy.  FOMC chairman already cleared way of lowest interest rate till 2022 last week. One thing which is in favor of US government is interest cost. Due to lowest interest rate , cost of trade deficit will be lower and it will benefit US economy in short term.

In short gold has more reasons to crash than rise if everything goes as it is. I have made case on basis of US economy which is main driver of gold & main consumer of dollar index. I am assuming US-China relation will be better by the end of 2020. I will update if there is change in this.

Technical levels according to chart is , Currently gold is trading at 1951$. Good support in this precious metal stands at 1870$. If trader break and close below this base. Then expect more pressure in gold till 1800$- 1750$.

Resistance in gold chart stands at 2030$. If trader breaks and close above 2030$. Then expect good rise in gold till 2080$- 2160$.

Conclusion: Currently gold trend is weak on chart and many economic indicators point out towards a weak gold price in upcoming months. Unless there is war or major change in current world.

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Crucial US Job numbers to decide the fate of Gold

US Job Numbers

Crucial US job numbers will be major deciding factor of gold price in September. Last month unemployment rate stunned market and came better than expected. Last month unemployment rate was at 10.2%. September’s unemployment rate expectations are between 10% to 9.5%. If unemployment rate hit below 9.5% then expect good crash in gold upto 1850-1800$. A rise in unemployment rate above 10.2% may send gold price to hit lifetime high once again. I will cover more on my youtube channel here

Recent crash in gold price from 2070$ to 1870$ came as dollar index advanced from lows of 93. But gold could not sustain on lower levels due to rising tensions between US & China. Exploding covid-19 cases also contributing in gold price rise. Last week gold recovered from 1905$ to test 1975$ as Fed chairman stated that FOMC is willing to rise inflation in order to support US economy.

Fed chairman cleared that he is not looking to raise interest rate in near term even if inflation exceeds Fed’s 2% target. They are willing to compromise on inflation in order to fuel economy’s growth. This came as surprise as fed is a major advocate to keep inflation on or below 2%.

Gold price fired from 1910$ to 1970$ after that statement as even fed is counting on weak economies. Recent job & GDP numbers from across the world showing crack & suggesting a big recession in upcoming months. But equity market euphoria keeping gold prices in check.

Currently gold prices trading at 1960$. Good support in gold chart stands at 1890$. If trader break and manage to close below this major support. Then expect good crash in gold upto 1850$ – 1800$ or even more crash is not ruled out.

Good resistance in gold chart stands at 2076$. This is above lifetime high. If traders break and close above 2076$. Then another fresh bull run in gold not ruled out till 2150$- 2240$.

Conclusion: Currently gold chart is in weak zone due to recent crash of 1870$ but silver prices are not entering in weak zone despite many attempts. So stay cautious and keep an eagle eye on job numbers.

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Brutal crash in gold price. Expecting more power to sellers

Gold price crash

Gold price crashed from 2070$ to test 1880$ yesterday. Brutal crash in gold price catalyst by Russian vaccine announcement. Russia announced, they have registered world’s first corona virus vaccine. Russian president Putin also informed that his daughter also received the shot and its completely safe.

Second reason was Trump’s statement that he is seriously considering to reduce capital tax gains. This also gave boost to DJIA index as it tested 28000. Dollar Index also recovered from lows which accelerated the sellers in precious metals pack. Investors also rushed to book their profits and contributed in selling of metals.

Gold price settled below 1900$ yesterday but quickly rebounded from lows and now trading at 1930$. Brutal selling from 2018$ to 1900$ changed the weekly chart of gold and many time frames already entered in weak zone. However corona virus rising cases could contribute in buying for gold but still I would be uncomfortable in buying for now.

Many countries are already in phase 3 for covid 19 vaccine and as far as media report suggests. We should be getting a vaccine for corona by this year end. If world get proper vaccine from US, India or any other country then we may see more panic in xauusd prices.

US job numbers also improved last week. Non farm payroll numbers came at 176K vs 153K expectations and even unemployment rate from 11.1% previous to 10.20% . Unemployment rate contributed the most in gold selling as expectations was just 10.5%. Better than expectations in job numbers brighten the chances of recovery in US economy. Which would impact gold prices further.

Currently gold price trading at 1930$. Good support in xauusd chart stands at 1870$. If price break and close below 1870$ then expect more pressure till 1830$ – 1800$.

Resistance in gold chart stands at 2020$. If trader break and close above 2020$. Then expect fresh buying from gold buyers till 2100$- 2220$.

Conclusion: Current trend has changed from positive to negative so I would not recommend any buying. Watch out for major data for levels & keep an eye on my youtube channel for daily gold analysis.

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Gold price hits above 2050$. Will gold streak continue ?

Gold price new lifetime high

Its been a fantastic run for gold price. Spot gold prices made low of 1450$ in March this year. Currently gold prices are trading above 2050$. Up more than 40% from its March’s low. This stupendous rally came just within 4.5 months. Gold is making new lifetime highs almost daily and closing on lifetime highs since last week. So will gold winning streak continue ? Lets find out.

Last week US released its GDP numbers. US GDP contracted nearly 33% first time in 70 years. Currently investors are pumping gold price as we are seeing new records in corona virus almost every day. Gold buyers are looking the tremors of central bank’s frenzy spending. FOMC alone spent more than $2 trillion to support US economy.

Another factor is jobs, people all over the world have lost jobs. Millions of people filed for jobless claims in US alone. ADP Non farm numbers released yesterday which came way below expectations. Soaring jobless numbers and crumbling GDP numbers are pushing gold price even higher.

Dollar Index is also another contributor to gold prices. Greenback fallen nearly 10% from its March’s highs and continuing its free fall despite great recovery in equity markets. Dow Jones & S&P already made almost at pre covid levels and yet dollar index is struggling due to US weaker economy.

Dow Jones & other US indices astonishing recovery suggest corona virus vaccine is just around the corner. Once we see some positive news regarding vaccine there should be a dramatic fall in precious metal prices. But that does not mean gold would conclude its dream run. We need to asses the situation to determine if its time to see gold 400-500$ back or just a minor correction of 100-150$ . For that we need to wait if there is vaccine beyond third phase trial.

Currently gold is trading at 2050$. Weekly support stands at 1920$. This is previous lifetime high which now stands as support. If gold manage to close below this level then we may see major correction in gold prices upto 1800-1600$.

Gold is uncharted territory so its hard to give resistance, however only few setups conclude a resistance at 2076$. If trader breaks and close above 2076$. Then fresh buying may drive gold price till 2105$ – 2200$.

Conclusion: Gold trend is positive and it would continue to remain positive as long as US or other world economy stays in trouble and our support stays intact.

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Gold dream run continues. More to come ?

Gold price dream run

Gold price continuing its dream run. From 1450$ to 1870$ within 3 months. Earlier in my post I cleared my stand on gold prices. If you are reading my article or watching my daily youtube videos then you must be knowing we are in buy. However gold has gained nearly 30% from its March’s low and continuing its dream run.

Gold price climbed from 1800$ to 1870$ in flat 3 days and still climbing every hour. Main reason of gold higher price is dollar index & rising corona virus cases. US stand tall with more than 3 million covid-19 cases. While other countries also recording big numbers. In India alone we had 45000+ cases corona virus cases yesterday. So surging virus cases creating uncertainty which is major driver of gold prices.

Another reason added in Gold since past few weeks is US & China’s deteriorating relations. Yesterday US unexpectedly asked China to close down its Embassy in Texas. This is one of the biggest step taken by US since start of trade war. China vow to retaliate this and we still need to see what China does in retaliation.

Due to covid -19 cases we are seeing a lot of uncertainty and traders are pegging gold to hedge their bets against rising stock market. Despite surging virus cases and deteriorating economies. Our stock markets around the world are clocking new high from its march lows. Infact US 30 & Nifty is just 10% shy from their lifetime highs. This is one of the biggest puzzle market need to solve in this pandemic.

Currently gold price is trading at 11 year high and continuing its march at 1873$. Good support in today’s chart stands at 1854$. Once trader break and sustain below 1854$. Then expect good profit booking in xauusd price till 1840$ – 1830$.

Resistance in gold chart stands at 1892$. If trader break and sustain above 1892$. Then expect good rise in gold till 1911$ – 1921$.

Conclusion: Surging virus cases & Bad economies driving gold price higher. We may see more highs very soon in yellow metal.

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