Home Forex News The Impact Of COVID-19 On Gold Prices (XAU/USD)

The Impact Of COVID-19 On Gold Prices (XAU/USD)

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The COVID-19 Scourge is one of the worst nightmares ever to engulf the world. Its cruel hand impacted gold trade in a significant way since the time the lockdowns were executed. It was a move taken by governments to try and curb the spread of the deadly virus that has so far claimed many lives globally. Reports indicate that there has been a major disruption in the supply routes, something that has hit hard the two leading markets which happen to be India and China.

A close outlook

The financial markets haven’t been spared either. Reports point out to some roiled markets that have eventually sparked a different mindset in investors who have started investing in the metal. Gold has over the ages been looked upon by everyone as the sort of metal whose value would remain stable no matter the prevailing circumstances.

The WGC’s chief market strategist, known as John Reade, shares his perspective regarding the current state of affairs. This official sees the current change as the most significant to have ever been witnessed in history. He expresses pessimism outlining that the worst bit of the crisis hasn’t been witnessed yet.

Gold performance

Reports have come out indicating a decline in the use of gold in jewelry production. Over the first quarter of the previous year, reports had come out pointing to a drop that left the figure at 325.8 tones. This was a massive drop with figures describing it as a 39% drop.

Time                            : 30-04-2020

Pivot                            : $1709.09

Technical View              : Short below $1713.29

Target                          : $1717.50, next target is $1720.86, $1729.07, $1740.54

Comments                  : Weak Bearish sentiment as the lifting of lockdowns could lead to a pullback

Last Price                    :$1731.60

The intricacies of gold are upsetting the norm in a significant way. There are also reports about the divergence of the gold markets, a case scenario that has witnessed a rise in demand to the West and a fall in the East.

Explanations have been given out, one of them being that traders in the West have been extra careful in the selling undertaking. The momentum buying here has been described to be a stronger one.

The COVID-19 has blown matters out of proportion, and thus it has become almost impossible to predict what the future portended in terms of the gold prices. The lull of uncertainty persists as governments continue looking for ways to save lives and stabilize economies.

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