SMM: on Monday, after a downturn, the gold market rose sharply in the evening, breaking through the $1850 / oz mark, a two-week high.
The news of Brexit brought uncertainty and fuelled risk aversion in the market.
Precious metal
Peter Hug, global head of trading at Kitco, said the previous level of $1775 an ounce was a key, but gold prices held up and eventually rebounded. "the gold market is generally good this week, and technically speaking, $1850 an ounce was an important support before, and it will not be easy to break through this level now."
Charlie Nedoss, senior market strategist at LaSalle Futures Group, said the current level of gold prices is very constructive. "the $1856 / oz level is the focus of attention, and this is the level that may be tested this week."
Daniel Pavilonis, a senior commodities broker at RJO Futures, said investors were not fully ready to return to the gold bull market and the sell-off was not necessarily over. "the market is a little tired, and the fall in gold prices this week will not be too surprising." Pavilonis pointed out that gold prices could fall back to $1797 an ounce this week, and if the close is below that level, there will be further selling.
Kunal Shah, head of Nirmal Bang Commodities research, said gold could test the $1900 / oz mark this month because of rising inflation expectations, continued outbreaks in the US, the continued weakness of the US dollar and the poor performance of the US job market.
Jeffrey Halley, senior market analyst at Oanda, said there is a resistance level for gold to rise to $1850 an ounce, and if it can break through this level, it can look towards 1920.
Foreign exchange market
ABN Amro: EUR / USD will rise to 1.25 by the end of 2021.
Commerzbank: the possibility of leaving the EU without an agreement has risen to 50% from 30% last week.
Peter Kinsella, head of foreign exchange strategy at Union BancairePriv é e, a Swiss asset manager, said: "it is clear that the market was overly complacent. In the next few days, people will trade for any relevant news. " Kinsella added that the strength of the pound against the dollar over the past week masked growing concerns.
Mimi Rushton, co-head of global trading and distribution at Barclays, said lasting hopes for a deal meant there was still room for sterling to fall despite poor progress in 11 hours of negotiations over the weekend, which is "what we are starting to see today".
John Madziyire, a portfolio manager at Vanguard, said he was not surprised by the fall in sterling because the market had "become more optimistic" recently. "at the moment, I think most analysts are actually looking forward to a deal. The market is not willing to price at any price. " The market will not hesitate until there is definite news.
"We are constructive in reaching an agreement between the two sides," said Sebastien Galy, a senior macro strategist at Nordea Asset Management.
Lee Hardman, foreign exchange strategist at Mitsubishi UFJ, warned: "the market is not willing to take too much risk at the moment. You may see some crazy behavior in the next few days. "
