Gold extends its geopolitically fuelled rally

Gold nuggets
Matt Simpson financial analyst
By :  ,  Market Analyst

Gold’s rally of late has essentially been on the back of risk-aversion. Equity markets have fallen whilst gold rose alongside the Japanese yen and Swiss franc as part of classic risk-off flows. Last week’s COT report revealed the increase of its net-long exposure was due to bears capitulating as opposed to fresh longs being initiated. And if that trend persists and we then see geopolitical risks reside, we suspect gold could face some selling pressure. But until then, a break above November’s high and a move towards 1900 is something to seriously consider.

In today’s video we look at spot gold prices on the daily and weekly charts and compare how XAU/USD has compared to our gold basket, which highlights its recent rally has been one of gold strength as opposed to US dollar weakness.



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