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by Emmeran Eder, Euro am Sonntag
S.The gold price has been bobbing for months. After the record high in summer 2020, it gave way because the nervousness has disappeared from the markets. Investors preferred to invest their capital in stocks or in the “digital gold” Bitcoin.
But now there was movement in the gold price again. It briefly exceeded the important 200-day line at 1,820 US dollars a troy ounce, which would trigger an upward trend in terms of chart technology. Meanwhile, the price of the yellow metal has fallen a little below, but is still above the 100-day line at $ 1,802. With the price of gold between these two important brands, a decision should be made in the coming days about which direction to take in the next few weeks.
In the future market, the players are overwhelmed by optimism. In any case, the number of speculators who bet on higher prices has risen sharply in the last four weeks. Sales of ETFs, which amounted to 129 tons in the first half of the year, have also ebbed.
There are several reasons for this. After the Bitcoin crash, many investors noticed how highly volatile the crypto currency is and rediscovered the advantages of real gold. The global demand for jewelry also increased sharply in the first half of 2021 – by almost 60 percent compared to the previous year to an impressive 874 tons. Purchases from China were primarily responsible for this. However, demand is still below the average for the past ten years. “There is still room for improvement here,” says Daniel Briesemann, precious metals analyst at Commerzbank.
In any case, he is of the opinion that “fundamentally, gold should cost a lot more”. The inflation rate has risen sharply in recent months and is currently around five percent in the USA and 3.8 percent in Germany. That should actually drive the precious metal, since gold is considered to be a good protection against price increases.
The negative real yields, which are at a record low of minus 1.18 percent in the USA for ten-year bonds, also speak in favor of higher gold prices. Gold, on the other hand, does not cost negative interest. In addition, investors should also turn to gold as a crisis metal because the corona cases are increasing again worldwide and a fourth wave threatens.
But there are also risks. In addition to the recently strong dollar, the rapid retraction of the bond purchase program by the US Federal Reserve would weigh on gold. At the moment, however, the opportunities outweigh the risks. With the Euwax Gold II ETC (ISIN: DE 000 EWG 2LD 7), which is physically secured and not currency hedged, investors are betting on higher gold prices.
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