Economic uncertainty creates more gold demand!
The New Year will prove to be quite bullish for precious metals: ABC To summarise this week’s global market fundamentals, Gold traded up to within a dollar of the ‘distinct’ resistance level mentioned in last Friday’s report before fading slightly. The rally has been helped by the passage of the much-discussed stimulus bill by US Congress with US$900 billion going to Coronavirus relief and US$1.40 trillion for government funding through to September 2021. Precious metals moved higher since the announcement with Silver and Gold up 5% and 2% respectively. The Dollar Index (DXY) is making a small comeback this week. There is good support around the 88.25 level, and DXY longs have been gently accumulating in the previous week, perhaps willing to take the view that the recent drop is overdone. If the DXY recovery continues, this could be a head-wind for gold movement so stay tuned as this situation unfolds. The five-year forward Inflation expectations have moved to almost two