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Yesterday, gold went up. At some point, the quote climbed to $1,912, which was 0.7% higher from the previous close.
As a reminder, the precious metal broke the $1,900 barrier for the first time since the beginning of the year but closed at $1.896.80.
Earlier on Wednesday, the quote broke through the resistance level one more time as the US dollar and yields on government bonds dropped.
These factors supported gold throughout the day. Yesterday, the US dollar incurred losses, especially against the yuan. The USD/CNY pair approached to its 3-year low. Meanwhile, bond yields plunged to 1.57%.
On Wednesday, gold closed above the key resistance level on the COMEX exchange, at $1,901.20. Gold futures for delivery in June added 0.2%, or $3.2.
According to ThinkMarkets analyst Fawad Razaqzada, gold is likely to continue moving in the uptrend. It is mainly due to the fact that the Fed intends to pursue its current monetary policy.
This month, gold has already soared by 7% and may extend gains. The precious metal may show the best performance in May since July 2020.
Notably, some experts suggest that the safe haven will advance only in the short term. Others, on the contrary, expect a prolonged rally.
Thus, Noble Gold President Colin Plume believes that the precious metal is steadily approaching to the $2K mark and may well reach last year's highs.
Sprott Inc. Chief Executive Officer Peter Grosskopf expects demand for gold to increase in the future.
Amid the rising public debt, as well as inflation, investors will begin to consider gold as a global currency that will help them protect their capital from devaluation, the expert says.
The Johns Hopkins University study also shows that the gold market is likely to be bullish. Professor Steve H. Hanke has come up with a new way to determine sentiment in the gold market. He developed a computer program that can calculate the index.
The algorithm scans all materials about gold available on the Web, searches for keywords and phrases, and on the basis of this information it draws a conclusion whether the bullish trend or the bearish one prevails in the market.
For example, the word 'inflation' " in combination with the adjective 'high' is considered positive for a precious metal. Conversely, 'low inflation' is a worrying sign.
The gold market is currently in the bullish trend, the economist says. Money supply is increasing along with the velocity of money. Inflation has already been 2-3 times higher than the Fed's target and continues to gather pace. All this has a positive effect on gold.
OANDA analysts suggest that gold will preserve its bullish impulse. However, a brief consolidation may occur in the short term. The quote needs to consolidate above the key level so that it can rise again.
The price movement of gold today will depend on the outcome of the Q1 GDP report in the US. The Department of Commerce is expected to review the forecast upward to 6.5% from 6.4% year-on-year.
Earlier on Thursday, gold was incurring losses. At the moment of writing, the precious metal plunged below the key level to $1,899.2. The difference in value from the previous day's closing price was 0.11%, or $2.
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