News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The Nasdaq 100 index is aiming to breach a key resistance level at 14,950 for a second time. A successful attempt may open the door to further gains, although the MACD indicator flags signs of weakness. Get your equities forecast from @margaretyjy here: https://t.co/BEYupi32qB https://t.co/PWeXE8tZVY
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here: https://t.co/4jsORznRTE https://t.co/t34kotPE8R
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here: https://t.co/BdgFmkRxVw https://t.co/lM1OIJdjhr
  • Trading Forex is not a shortcut to instant wealth, excessive leverage can magnify losses, and sentiment is a powerful indicator. Learn about these principles in depth here: https://t.co/lZFM8youtX https://t.co/6qGEVjDlN6
  • Although the medium-term outlook remains negative, Bitcoin could make a bullish move in the coming days if prices manage to hold above key support in the $29,150/28,600 region. Get your #Bitcoin forecast from @DColmanFX here: https://t.co/T7iAD0fbbU https://t.co/xVSG7nKIQG
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here: https://t.co/IsnpfJhp91 https://t.co/HGWZikGQAa
  • Brush up your knowledge on trade-wars with this tool from DailyFX research briefly outlining trade-war history dating back to the early 1900s here: https://t.co/bZEFtp8kFe https://t.co/2cQ0JgAfh7
  • Crude oil prices collapsed on Monday despite an OPEC+ breakthrough, driven by Covid-induced demand woes. Meanwhile, Gold is at odds with a stronger US Dollar and falling Treasury yields. Get your #crudeoil market update from @FxWestwater here:https://t.co/H1vmag8d1k https://t.co/1zuPdKUmyE
  • AUD/USD is likely to face increased volatility over the coming days as it faces a batch of key event risks going into the end of July. Get your Australian Dollar forecast from @DavidJSong here: https://t.co/qFpg0DCxxL https://t.co/quQxg4WBy3
  • The US Dollar outlook against ASEAN currencies like the Singapore Dollar, Thai Baht, Indonesian Rupiah and Philippine Peso remains bullish amid capital outflows risks as Covid cases swell. Get your market update from @ddubrovskyFX here:https://t.co/vRUVxvQP8o https://t.co/cUEkW9BfIP
Gold Price Outlook: Will a Covid Vaccine Kill the Bull Case for Gold?

Gold Price Outlook: Will a Covid Vaccine Kill the Bull Case for Gold?

Peter Hanks, Strategist

Gold Price Forecast:

  • Gold suffered a serious decline to start the week, cratering more than 5%
  • Luckily for bulls, price action would suggest technical support helped stave off further losses
  • While a potential covid vaccine has seemingly pushed gold prices lower in the short term, the longer-term effect may be less straightforward

Gold Price Outlook: Will a Covid Vaccine Kill the Bull Case for Gold?

Gold has experienced significant volatility this week after suffering a drastic decline Monday morning on news of a potential Covid-19 vaccine. The development saw a broad rise in risk assets while safe havens like gold and the US Dollar pulled back. As a result, the precious metal sought assistance from technical support around the $1,850 area.

Gold Price Chart: 4 - Hour Time Frame (June 2020 – November 2020)

gold price chart

As the market calmed following the initial price reaction, gold has regained its footing and trades between support around $1,850 and nearby resistance along the $1,920 mark. Confined between two horizontal levels and grasping for its next move, some might suggest the bullish outlook for gold has been eradicated by the coming vaccine. But has it really?

Advertisement

Well, not entirely. While a readily available vaccine on the horizon is an undoubtedly positive development for the world, there is a question of how quickly herd immunity can be reached. Rumored to be 90% effective, such a vaccine would still require a majority of the population to be vaccinated until the hurdle for herd immunity is met. Further still, distribution could prove to be a logistical nightmare and only delay the uptake more.

With that in mind, many of the bullish catalysts behind gold remain. Regardless of vaccination rates, the Fed has reiterated its willingness to remain accommodative into 2023 and both parties in Washington have expressed interest in another stimulus package. Add in a possible infrastructure plan under the Biden administration and it seems the outlook for the US Dollar remains troubled as these plans will increase its supply – an important tailwind for XAU/USD.

Thus, the development of a coronavirus vaccine may not have killed the bullish outlook for gold, but it has clearly undermined it this week. To that end, the fundamental drivers behind higher gold prices should linger even after a vaccine is distributed so the yellow metal’s outlook remains constructive over the longer-term – in my opinion.

From a technical perspective, the broader formation of a bull-flag remains intact and support around the $1,850 mark appears to have provided a nearby springboard for a quick recovery. Unless gold breaks its current technical pattern by falling below $1,800, I am hesitant to suggest the bigger-picture has changed. In the meantime, follower @PeterHanksFXon Twitter for updates and analysis.

--Written by Peter Hanks, Strategist for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES