Source: Economic Events March 11, 2020 - Admiral Markets' Forex Calendar
Global financial markets were hit by another risk-off wave at the start of the week, after oil prices collapsed in response to Russia resisting Saudi Arabia's push for deeper production cuts at the OPEC meeting last week.
While Equity markets dropped massively, and market participants talked of a "Black Monday", Gold failed to significantly break above 1,700 USD.
This seemed to be because traders sold profitable Gold positions to meet margin calls resulting out of dropping Equity prices.
But even if Gold lost some of its bullish momentum, the outlook stays very favourable for the precious metal: after the Fed announced its "emergency rate cut" last Tuesday, the first time since October 2008, and market participants expect further cuts by the Fed.
In fact, the Fed Watch Tool currently sees the Fed cutting another 75 basis points at the meeting on March 18, with volatility staying elevated and a clear risk-off bias among market participants, which should keep the pressure on US yields high. Thus, the outlook for Gold stays very positive and a sustainable break above 1,700 USD seems only to be a question of time.
Technically, the mode stays bullish as long as we trade above the daily trend support which can still be found around 1,535/545 USD:
Source: Admiral Markets MT5 with MT5-SE Add-on Gold Daily chart (between December 7, 2018, to March 10, 2020). Accessed: March 10, 2020, at 10:00pm GMT - Please note: Past performance is not a reliable indicator of future results, or future performance.
In 2015, the value of Gold fell by 10.4%, in 2016, it increased by 8.1%, in 2017, it increased by 13.1%, in 2018, it fell by 1.6%, in 2019, it increased by 18.9%, meaning that after five years, it was up by 28%.
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