Gold May Rise Following Inverted Yield Curve On US Treasury and
Gold May Rise Following Inverted Yield Curve On US Treasury and Trade War
Technical Analysis
Gold prices have broken the triangle pattern while still holding the gann 2/1 line and 0.50 fibonacci retracement, the target price is at february high at the 1341.85.
Fundamental Analysis
Because with short-term US rates now higher than long-term rates, history says that today's inverted yield curve foresees an economic recession sometime in the next 2 years. But despite cutting its holdings of longer-term bonds however, the Fed has failed to push longer yields higher. Indeed, the market has now priced in a rate cut from 2.96% to 2.70% on the 30-year bond since this point in May 2018.
Rate cuts coupled with higher inflation due to the tariffs is a very bullish combination for precious metals.
Gold premiums in top consumer China rose this week as investors bought the metal as a safe-haven due to rising trade tensions with the United States, while bullion demand moderated in India as local prices jumped to
two-week highs.
In China, premiums rose to about $14-$18 an ounce over the benchmark from $12-14 an ounce last week.
Technical Analysis
Gold prices have broken the triangle pattern while still holding the gann 2/1 line and 0.50 fibonacci retracement, the target price is at february high at the 1341.85.
Fundamental Analysis
Because with short-term US rates now higher than long-term rates, history says that today's inverted yield curve foresees an economic recession sometime in the next 2 years. But despite cutting its holdings of longer-term bonds however, the Fed has failed to push longer yields higher. Indeed, the market has now priced in a rate cut from 2.96% to 2.70% on the 30-year bond since this point in May 2018.
Rate cuts coupled with higher inflation due to the tariffs is a very bullish combination for precious metals.
Gold premiums in top consumer China rose this week as investors bought the metal as a safe-haven due to rising trade tensions with the United States, while bullion demand moderated in India as local prices jumped to
two-week highs.
In China, premiums rose to about $14-$18 an ounce over the benchmark from $12-14 an ounce last week.