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One the Brink of Sell-off

Olymp Trade

Gold begins a new trading week near the level of $1460 per ounce. Last week, the asset lost more than 3%, while there was no correction to the movement down. Bears look very strong, so breaking the $1460 level is quite likely to be just a matter of time. As a part of the current trend, gold may well fall to $1430, but if active speculative sell-offs begin, quotes may drop to the psychological level of $1400 for a while. In case of the most aggressive scenario, the price may drop to the level of $1360, which has been a resistance level for a very long time, and will now act as a strong support one.

It is possible that speculative sales will begin soon. Bloomberg reported that 2 major investment banks JP Morgan Chase and Citigroup closed their bets on gold, and their strategists changed the rating from underweight to overweight. This is not about the spot metal, but about derivatives: futures, options and swaps. The Bank considers it appropriate to reinvest capital in risky assets. Bank analysts offer to sell not only gold, but also US government bonds, which are also considered to be safe haven assets.

Source: https://olymptrade.com/
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