The second quarter of 2021 is just around the corner. Usually by the end of the quarter there is an increase in volatility in the markets as many companies and funds rebalance their portfolios. Be careful as there could be a bit of a turbulence. Whether there will be more gold in these portfolios is the question.
For the time being, gold remains in uncertainty. The price per troy ounce has been in a range for the past week. There were hardly any upside attempts, although there was potential.
Perhaps gold is waiting for Friday’s payrolls, which will show the US labour market dynamics. Also, during the week there will be a lot of speeches of regional banks’ heads, which will try to clarify the current situation and make forecasts to some extent.
According to the latest statements it was clear that the officials have split into two camps. Some want to continue the QE program and keep rates low for as long as possible, others are already calling for a gradual scaling back of the QE program and a tightening of monetary policy. One thing they agree on is that the labour market should be watched closely now. Only once it has recovered can further steps be taken.
What else can be said about gold. The main upward trends have not been broken. The uptrend continues, and now investors are in some waiting for the labour market data. Of course gold has a very strong resistance level at the top, which will be impossible to pass without momentum.
Another problem is the strengthening USD, which has been the favorite currency in the last couple of days. Investors opted to exit some of the risky assets into the USD before the statistics. Because of this the price of the precious metal fell.
The closing of the quarter is taking its toll, therefore gold is likely to remain in consolidation in the next couple of weeks, and will not show much momentum. But, a rise in inflation has not been cancelled out. The pumping of money into the system has not stopped, and we will see $2000 per troy ounce in gold in the near future after all.
8.00 UK Q1 2021 GDP
11.00 EU Consumer Price Index YTD
14.15 ADP private sector employment report for June
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