- Gold and copper continue to enjoy safe-haven status
- Rally might be extended due to slow economic recovery
- Gold might reach an all-time high.
Gold (XAU/USD) and Copper (HG/USD) prices have been enjoying strong bullish performance, especially with the ongoing coronavirus situation, taking a toll on the global economy. This has negatively affected most fiat currencies across the world and subsequently resulted in reduced demand. This is why gold and copper have been gaining due to their increased demand as investors turn to precious metals and other commodities to shield their investments from losses.
Time : 18/05/2020
Pivot : 1755.81
Technical review : Long above 1762.24
Target : 1763.68, 1769.36, 1777.58, and 1791.38
Technical review : Short below 1751.37
Target : 1746.94, 1741.51, 1733.24, 1724.92
Comments : Weak Bullish to Neutral
Last Price : 1761.67
The price of gold managed to reach a 7-year high following the Federal Reserve’s recent warning that asset prices would likely continue to take a hit well into 2020 due to slow economic recovery. The rallying Bitcoin and copper prices are aided by the prevailing coronavirus concerns, especially the fears of the second wave of coronavirus infections. There are also other concerns, including trade war concerns and Brexit concerns, which have made investors shy off from major cryptocurrencies and instead seek refuge in gold, copper, and other commodities.
Gold and copper outlook
Gold and copper are currently very attractive, and they will likely continue to be for the next few months. Copper also started Monday morning on a strong rally thanks to the hopes of renewed demand now that some of the restrictions put in place due to the coronavirus have been lifted. Copper is one of the metals widely used in the industrial sector, and the lifted restrictions should contribute to higher demand for industrial metals.
The demand for gold is expected to continue, but it might not necessarily be a smooth sail. This is because upward momentum will largely depend on ETFs buying, considering the demand for gold is not as strong in other sectors. Nevertheless, there is still a lot of uncertainty in the market, especially with economic news having a huge impact since investors are on high alert.