SMM10 on March 30: yesterday, the main contract of Shanghai Gold fell below the 400th mark and continued to hover low today, subject to a strong rebound in the US dollar and a decline in gold demand, and precious metal prices are under short-term pressure. As of the day's close today, the Shanghai Gold 2012 contract was down 0.65% at 397.1, while the Shanghai Bank 2012 contract was down 0.81% at 4921.
Financial markets tumbled across the board this week, with spot gold prices falling below the $1860 / oz support level at one point. The analysis pointed out that the uncertainty surrounding the US election and the market's fear of a further blow to the economy due to the re-outbreak of the epidemic in many parts of Europe have left the whole market in a wait-and-see state. And in terms of positions, due to a large number of bullish factors in the macro gold market, there are still a lot of long positions in the market, and once investors' views change, then these long positions mean a huge risk of selling.
In addition, total gold demand fell 19% in the third quarter from a year earlier to 892 tons, the lowest quarterly total demand since 2009, according to data released by the World Gold Council on Thursday. Falling demand for gold has led to an increase in market bears.
Institutional review
Guoxin futures: us dollar high shock gold and silver short-term still under pressure. Lagarde was more pessimistic about the outlook for the European economy at the ECB meeting, considering a policy increase in December to keep the dollar index higher during the day and weaker in gold and silver. The US election day is approaching, the US dollar is still under upward pressure with a strong sense of risk aversion, and the market environment is changing rapidly. Short-term precious metals are under pressure and high volatility will continue, while silver, which is more flexible, faces greater risk of two-way volatility. In the long run, there is limited room for the recovery of nominal interest rates on US debt, the relaxation of the inflation target is good for the rebound of medium-and long-term inflation expectations, the fiscal stimulus will eventually be introduced after the election, and the long-term asset allocation of precious metals remains prominent.
Rida Futures: there has been a surge in new confirmed cases overseas, a rise in risk aversion, a sharp fall in capital outflows from US stocks, a shift to the dollar index, and the failure of US economic stimulus negotiations to put pressure on precious metals. However, it is expected that under the support of uncertainty in the US election, gold and silver will remain underneath.
Golden Source Futures: Biden continues to lead incumbent President Trump across the country ahead of election day on November 3, but competition in swing states is fiercer. The strong rise in the dollar index is the main reason for the recent decline in gold prices. The logic that we are bullish on the continued strength of the dollar index is mainly based on the following three points: first, the deterioration of the epidemic in the euro zone, the relative quality of the epidemic in the United States and Europe will support the dollar index; second, funds are continuing to flow into dollar index futures; third, the sharp rebound in long bond spreads between the United States and Germany also supports the dollar index. We believe that at present, precious metals are still in the process of periodic adjustment. In this round of decline, the international gold price will fall below the previous low of US $1850 and will continue to explore the US $1800 / oz front line for support. Silver prices will continue to fall more sharply and are expected to fall to the $20 / oz line.
