Gold MCX Report – Keep Eye on 53700 Above Target 55400—56500.
Red Alert : Below 53700, Be cautious at higher level.
Read More : Gold Prices Above $1972 Next Ultimate Target $2020—$2050 – Neal Bhai
Gold Spot Hit 1st Target $2030.92
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Gold’s scorching rally gathered more force, with prices driven higher into record territory above $2,000 an ounce as investors assessed prospects of more stimulus to combat the coronavirus pandemic’s fallout, another slide in U.S. real yields and increased geopolitical risks.
Bullion is up more than 30% this year, and could extend gains as governments and central banks respond to slowing growth with vast amounts of stimulus. Federal Reserve Bank of San Francisco President Mary Daly said Tuesday the U.S. economy needs more support than originally thought. The haven’s allure as a store of wealth is strengthening as investors face the prospect of a long global recovery, and the debasement of fiat currencies, with banks including Goldman Sachs Group Inc. forecasting a rally to $2,300.
“The stage has been set for gold to continue to climb higher,” Paul Wong, market strategist at Sprott Inc., said in a report. “We see increased fiscal spending ahead, extremely accommodative monetary policy in place for years and a challenging economic recovery, as stated by the Fed.”
Shifts in the U.S. bond market have also underpinned gold’s meteoric ascent, with an added lift from a weaker dollar. Real yields on 10-year Treasuries have collapsed below zero and hit a record low below -1% on Tuesday. After sinking 3.3% in July, the U.S. currency is now lower in 2020.
Spot gold rose as much as 0.6% to a record $2,031.14 an ounce, then dropped to $2,014.96 at 12:28 p.m. in Singapore, while most-active futures traded as high as $2,048.60 on the Comex. Spot silver climbed as much as 1.3% to $26.3473 an ounce, the highest since 2013, before trading lower.
“Despite the bullishness and macroeconomic drivers in gold’s favor, the rate at which prices have appreciated increases the risk of a correction,” said Avtar Sandu, senior manager for commodities at broker Phillip Futures Pte. However, the bull’s case for gold remains intact with low real rates seen sustaining higher prices, he said.
Treasury Secretary Steven Mnuchin said the White House and Democrats aim to strike a deal on virus-relief legislation this week — even though the two sides remain far apart on some issues. Meanwhile, U.S. and Chinese officials plan to assess the nations’ trade accord this month against a backdrop of rising tensions between the countries, according to people briefed on the matter.
