News side:
In the past week on Friday (March 17), the European Central Bank announced a 50 basis point rate hike this week and the Federal Reserve next week, at a time when the collapse of the US banking system and the bailout of the European banking crisis have called into question the plans of central banks to fight inflation. Will it follow up? Markets have moderately adjusted to the aftermath of the banking crisis. Markets now expect rates to peak in May with just one 25 basis point hike followed by cuts for the rest of the year. Spot gold closed at $1,988.67 an ounce on Friday (March 17), a sharp rise of $69.37, or 3.61%, and a surge of $121.52, or 6.51%, this week, the best performance since March 2020. The gold market had its best week in three years amid the banking crisis.
Beyond that, a looming recession weighed on risk sentiment and drove safe-haven flows to precious metals . In addition, a sharp drop in U.S. Treasury yields was seen as another factor positive for non-yielding gold prices and continued to support a strong intraday rally. Anti-risk sentiment and increased bets on a 25 basis point rate hike at the upcoming Federal Open Market Committee (FOMC) meeting on March 21-22 dragged U.S. bond yields lower. Investors now appear convinced that the Fed will take a less hawkish stance following the collapse last week of two mid-sized U.S. banks, Silicon Valley Bank and Signature Bank. The European Central Bank raised interest rates by 50 basis points on Thursday as scheduled, but dropped its forward guidance, saying future rate hikes would depend on the state of economic data. Current expectations that the Fed's policy rate may not rise above 5 percent have weighed on the dollar and partly supported a surge in gold prices.
Gold trend analysis:
With the bankruptcy of Silicon Valley Bank, the risk aversion sentiment in the gold and silver market has also increased significantly this week. Last week, gold rose by more than 115 points, and the daily line rose by 70 points on Friday alone, setting a new record in the past two years. The closing line at the end of the session was around 1983.5, and the very strong high-level closing pattern also means that the rising trend has not stopped. This week, gold still has the possibility of opening higher and moving higher. The 2000 mark may even break through All-time high.
Looking at gold on the daily line, gold prices may continue to rise on Monday, but the strong pressure at the 2000 mark needs to be treated with caution. Gold prices are currently trading well above all of its major moving averages, with the 20-day simple moving average (SMA) gaining upward momentum above the longer-term moving averages. Meanwhile, technical indicators are almost vertically up within positive levels, giving momentum to the bulls. Looking at the 4-hour line, gold does not appear to be overbought, but the price is much higher than the MA, and the price needs to be adjusted. Meanwhile, the 20-period SMA gained momentum and broke above the 100-period SMA, which is also slightly higher. On the whole, it is enough to continue to see more at the beginning of the week.
Operational strategy: Gold is around 1970, stop loss is 1964, target is 1990-1998; intraday strong breaks high, evening retracement can be more than two times, look at 2009-2015 (for reference only, the specific point is given in the firm offer)
Crude oil trend analysis:
In terms of crude oil, last week it was extremely weak and fell below the low of 70.0, and the lowest touched the 65.2 line. On Monday, crude oil reversed at 67.2-67.3, stop loss at 68.3, look at 65.2-64.7, and the target for this round of decline is 62.0-60.0!
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