SMM News: behind the recent sharp fall in the gold market is the pressure brought by the rebound of the dollar, and in the case of the continued dollar index, gold may be further under pressure.
Charlie Nedoss, senior market strategist at LaSalle Futures Group, said the dollar was the "main culprit" that depressed gold recently.
"it's all because of the dollar, which continues to recover and gold is near its 100-day moving average, which will be a big support."
Peter Hug, global head of trading at Kitco, said that as the US election, the epidemic and the US economic recovery all meant a lot of uncertainty, investors were likely to stay on the sidelines before the election, so the whole market was full of liquidity.
"investors are getting more and more nervous in the whole market right now."
Hug believes that with the election approaching and the United States may have a second round of epidemic, the stock market is under pressure and the whole market may be a mess.
"A lot of investors take profits in the stock market and gold market, and when they become more nervous, the natural reaction is to leave the market and hold the currency."
Hug pointed out that cash has a strong advantage for investors to buy on the bargain when the market falls, and it is safer to hold cash when the whole market is selling.
"as a result, a large number of investors are leaving the market because they want to allocate the money to cash."
Hug said that $1850 an ounce has strong support, but if it falls below that level, then it looks like 1820 support.
"at the top, the resistance level starts with $1875 and then $1900 an ounce. If the stock market stabilizes or even goes higher, gold will test $1900 an ounce upwards. "
Hug pointed out that due to the imminent impact of the US election, apart from short-term fluctuations, the macro aspect of the market as a whole is still positive for gold.
"if gold falls by $200, that doesn't mean the bullish trend in gold is over."
Hug pointed out that even if the US election is basically normal, the Fed will not raise interest rates until 2023, while the ECB will inject more liquidity and remain bullish on gold.
