Gold prices continued to soar.
On March 8, COMEX April gold futures closed 0.32% higher at 2165.20 dollars/ounce, hitting a record closing high for the fifth consecutive trading day. Spot gold also hit a new high, touching 2164.65 dollars/ounce, closing at 2159.80 dollars/ounce, rising for the seventh trading day. At the same time, the gold price in the domestic market also showed a strong trend.
"In the future, under the current overheated trading, many technical indicators appear overbought or deviated, and it is not suitable for precious metals to catch up in the short term. Such a soaring market still needs the verification support of the heavy data and events within the week, and we expect that in the next few days, the callback pressure of precious metals caused by the multiple replenishment will increase." Xia Yingying, a non-ferrous analyst of Nanhua Futures, told surging journalists.
Gold prices hit a record high
On March 8, COMEX April gold futures closed 0.32% higher at 2165.20 dollars/ounce, hitting a record closing high for the fifth consecutive trading day. Spot gold also hit a new high, touching 2164.65 dollars/ounce, closing at 2159.80 dollars/ounce, rising for the seventh trading day.
At the same time, the gold price in the domestic market also showed a strong trend and set a new record high. On March 7, the opening price of the spot gold of Au99.99 on the Shanghai Gold Exchange was 499.5 yuan/g, which once exceeded the historical high of 500 yuan/g, rising to 506 yuan/g at the highest point. The variety closed at 505.1 yuan/g, with a turnover of 5.379 billion yuan.
The continuous rise of gold price has driven gold stocks to soar. By the end of the afternoon of March 7, the precious metal sector had risen 3.61% on the same day, Sichuan Gold (001337) had risen by the limit, Western Gold (601069) had risen by 9.47%, and Yintai Gold (000975), Hunan Gold (002155), Shandong Gold (600547) and other stocks had risen by more than 3%.
On the market, the two gold stocks ETF also showed strong performance, both rising more than 4.5%. In addition, gold ETFs tracking the trend of gold spot rose one after another, and many products rose more than 1%.
Moreover, retail gold prices in domestic gold stores continue to soar. Chow Tai Fook, Chao Hong Ji, Liu Fu Jewelry, Zhou Shengsheng, Xie Ruilin and many other head gold stores announced that the price of gold jewelry exceeded 655 yuan/g.
The continuous rise of gold price has ignited the purchase enthusiasm of consumers. According to the Global Gold Demand Trend Report released by the World Gold Council, China's domestic gold jewelry consumption will reach 282 billion yuan in 2023, a record high. However, the agency also pointed out that although the demand for gold jewelry in the first quarter of 2024 may remain strong due to the sales growth before the Spring Festival holiday, the consumption of the whole year may still face challenges due to the rising gold price, slowing economic growth and weakening demand for wedding gold.
Yao Xi, fund manager of GF Shanghai Gold ETF, pointed out that Bank of America and commercial real estate risk fermentation; The fall in economic data and the expectation of the US to cut interest rates in disguised form are the main factors driving the rise in gold prices. In terms of financial risk, following the explosion of SVB and the signatory banks, the Community Bank of New York exploded again on March 1, causing the market to worry about the risk of financial real estate in the United States. In addition, the US ISM manufacturing PMI announced last week was lower than expected, cooling the economy in January, which was much higher than expected. The expectation of interest rate cut in market transactions also increased, pushing up gold prices. At the same time, the director of the Federal Reserve proposed to "buy short and sell long" in the bond market, which means that the Federal Reserve is expected to increase the purchase of short-term treasury bonds in the future, release liquidity in a disguised way, and form a positive effect on gold prices.
How long can the rise last?
Gold has been hovering at a high level. How will it behave next?
"In the future, under the current overheated trading, many technical indicators appear overbought or deviated, and it is not suitable for precious metals to catch up in the short term. Such a soaring market still needs the verification support of the heavy data and events within the week, and we expect that in the next few days, the callback pressure of precious metals caused by the multiple replenishment will increase." Xia Yingying, a non-ferrous analyst of Nanhua Futures, told surging journalists.
Phillip Streible, chief market strategist of Blue Line Future, pointed out that the key catalyst of the gold market is the timing, pace and depth of interest rate cuts. The data shows that within one month after the first interest rate cut in 1990, the gold futures rose by an average of 6% - and so on, "one year later, the gold price can easily rise to $2500".
Huatai Securities said that in the past two years, the global central bank was the main buyer of gold. At present, gold has reached a new high, but ordinary investors' gold positions are low, and position covering may further promote gold prices.
Western Securities believes that gold may also start a new round of rising cycle in the context of interest rate cut in the United States and slowing down of scale contraction and global de dollarization. On the one hand, the US interest rate raising cycle has basically ended, and the Federal Reserve may also enter the interest rate cutting cycle in 2024. The downward trend of real interest rate is expected to push up gold prices. On the other hand, at present, the policy of shrinking the table has gradually entered the second half, and the price center of gold may be gradually suppressed. With the intensification of anti globalization and geopolitical games, and the acceleration of de dollarization trend due to the demand of "security" and "independence", the monetary and financial attributes of gold may jointly drive gold to start a new round of rising cycle.
Xia Yingying analyzed that with the end of the revision of the Federal Reserve's optimistic interest rate cut expectation, the time point of the Federal Reserve's interest rate cut will be further approaching, and it is expected to show an open interest rate cut path, and the center of gravity of precious metal prices is expected to rise further. However, under the short-term boom market, the price performance ratio of chasing the rise has been low. "It is recommended to hold the precious metal more carefully before the rally, or reduce the position when it is high, but it is not advisable to short and wait for the opportunity of low attraction after the callback. However, we also expect that the overall callback space of precious metals may be limited, and it is recommended to focus on the support of the 5-day average first. In general, it is not suitable to chase the rise in the short term, but the callback should still be regarded as a medium and long-term opportunity to bargain."
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