Gold preparing to take 2000 level-Budrigantrade review
2023.03.28 18:22
Gold preparing to take 2000 level-Budrigantrade review
By Kristina Sobol (Budrigantrade)
Budrigannews.com – The gold market might be aware of something about the banking crisis in the United States that other markets, financial regulators, or even the banks themselves are unaware of.
Gold futures were back at the $2,000-an-ounce level on Tuesday, a day after falling to mid-$1,900 levels. This was despite the fact that a closely watched Senate hearing that was supposed to discuss a spreading contagion did not mention it.
According to Craig Erlam, analyst at online trading platform OANDA, the yellow metal’s behavior suggests that investors in the country “don’t think the mini-banking crisis is behind us or, perhaps more likely, that scarring from it in credit markets has permanently reduced the tightening required from central banks.”
Erlam went on to say, “That could be bullish, if so, for gold” and that traders might even keep an eye on the all-time highs if rate cuts this year happen.
After officially concluding Tuesday’s session at $1,973.50, prices on New York’s Comex hovered around $1,994 in post-settlement trade, up $19.70, or 1%, for the day.
Last week, the benchmark gold futures contract behaved similarly, trending in the high $1,900s before breaking through the $2,000 long-term target twice in three sessions between Thursday and Monday.
During the session on Tuesday, the, which some traders followed more closely than futures, reached above $1,975.20.
Even though Federal Reserve supervisory chief Michael Barr’s testimony to the Senate did not expand on concerns about the spread of the U.S. banking crisis that had been revealed three weeks earlier, gold prices moved closer to $2,000 that day.
In a two-hour appearance before a Senate board on banking, Barr adhered to the deficiency in risk blunder and other “safe” rehearses at Silicon Valley Bank that prompted billions of dollars in client store withdrawals from the California-based moneylender and without a doubt two different banks that set off the emergency.
However, Barr did not provide traders with such headlines, at least not in the event that they were expecting to hear about contagion from the Silicon Valley fallout. In case it wasn’t already obvious, the Federal Reserve’s administrative boss previously said in his pre-declaration discourse on Monday that the national bank’s survey showed the U.S. banking framework was “sound and tough, with solid capital and liquidity”.
In remarks that were published on the website of bullion trader Kitco, FXTM senior research analyst Lukman Otunuga stated, “While prices could trade lower in the shorter term to medium term, the longer term still remains in favor of bulls due to expectations around the Fed cutting interest rates in September.”
It is anticipated that the Fed will conclude its rate-hiking cycle sometime between May and June, following nine rate increases totaling 475 basis points over the previous 13 months. The national bank has precluded any rate cuts during the current year, however experts aren’t precisely certain.
More:
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