So far so good for the USD and the US economy which is the most dominating currency and barometer for major market volatility. The most interesting scenario would be, what the market would look like, if the opposite situation comes into play. A weakening US dollar is always great for the precious metal’s prices. A weakening dollar can be associated with bad business deals as in the case of China and Europe imposed tariffs which is constantly being brought back to focus amid its importance and influence on the global scene. At the same time the North Korean issue is also boosting Gold prices.
Gold’s rally was seen very impressive in the opening of 2018 after the close of 2017. The precious metal reached $1,366 per ounce. Since April 2018 until now, the shiny metal made a correction by dropping by $66 of worth. The precious metal tumbled and lost the advancement it made since 2017 when prices which were below $1,300.
News coming from Australia have in focus a very useful technological advancement that measures gold in mineral samples. These samples are seen under X-ray’s that activate the Gold presence and by this they can measure the concentration level of the shiny metal. This method is a faster, safer and more environmentally-friendly method and is seen as a substitute to the traditional fire test method for gold analysis. Its most spectacular benefit is that it significantly reduces the time needed to get results from days to minutes giving the potential investors a faster decision opportunity.
As a result Australia has now an export opportunity worth $1 billion in gold mining alone, and a competitive edge for Australia’s mining industry on the global stage. Australia is the world’s second largest gold producer and the industry will benefit from the opportunity to capture more value from mined resources, as well as increased operational efficiencies, revenue and productivity.
In the past week strong demand was seen for Gold indicating traders are in search of an instrument that can increase in value during times of uncertainty.
Even though the morale is quite low for the time being, Gold has been able to remain close to the $1,300 psychological price trading just below it, for a period of one week. In the current week, gold proved it has not made its final statement above the level of $1,300 and has somewhat survived the perfect storm which is the strengthening of the US dollar.
As a conclusion, we believe Gold will regain its full strength to reach higher grounds especially as the summer kicks in. If the commence of June finds the precious metal above $1,300 , the shiny metal’s demand and supply would be at the same level it started the year and the unresolved geopolitical issues will help strengthen its prices.
Gold is currently trading at approximately $1304.50
There is strong resistance at $1,304.72 Resistance level and if a clear break is viewed then a bullish market could be in play with the precious metal price moving towards the $1308.95 Resistance hurdle.
If the bears take the driver’s seat, we could see the shiny metal falling towards the $1300 support barrier and even breaching it aiming for the $1295.15 Support level.
If traders decide to remain uncertain as of the Bullion’s direction we may see a sideways movement between the 1300 Support level and the 1304.72 Resistance level.