What Push Up the Gold Price in 2022?
- 2022-01-18
Gold started the new year with the side way trading around $1,800, which was down from 2021 close at $1,830. Then, rise from $1,782 due to the concern of the rates hike within this year and the concern of the inflation. US Fed expected 3 times rates hike in 2022, which started from March, which means that will changing the perspectives and advantages to the Gold.
The concern of the geopolitics including the prolonged conflicts between the South and North Korea with the contribution of the United States of America. The tension between the US, China and Taiwan, the tension between NATO, EU and US, and Russian with Ukraine, which created the Cuban Missile Crisis. Recently, the Kazakhstan president Mr. Kassym-Jomart Tokayev has resigned after the hikes of Oil price in this oil rich country in central Asia.
During the period of the policy tightening from end of 2015 and 2019, the Fed has hiked rates 9 times and Gold price has been increasing up to 35%. In between 2004 to 2005, the Fed has increased rates by 17 times and Gold price has been increased by 70%. Likely, in 1970-decade, interest rates have been increased by 4.75% in 1976, the rates have been increased up to the high of 20% in 1980m at the same time, Gold has been increased from $185 per ounce to $850 per ounce.
The Gold purchase in India and China is increased significantly. The demand in India per person is over 500 tons in 2021, which above the current supply of the gold mint in 2020.
The spot gold purchase by the world central bank still continue and even increase. Recently, even Singapore and Ireland central bank has made the first purchases in over a decades due to the concern of the inflation.
Gold prediction still pay attention on the factors that could possibility push the price up to $1,970 and down to $1,650.
The recommendation for this week: Based on the trend analysis, Gold constructed the major resistance at $1,802, investors could buy gold at $1,812 to $1,815, setting the profit at $1,835 or $1,845 and target $1,860.
Analyzed by : Mr.Tum Sothoeurn, Independent Analyst