The Perfect Storm That Hit Gold Five-Years Down

The Perfect Storm That Hit Gold Five-Years Down


Commodity markets have seen what has become known as the “perfect storm” caused a drop of gold to its lowest level for more than five years on Monday after he caused a range of factors to put pressure on the precious metal to fall to 1070 levels before returning quickly to stabilize above the level of $ 1,100 per ounce in the current period.
A series of events have had a strong influence on the movements of gold and caused a strong drop was the most important of these events:

Decline in demand for gold as a safe haven. Where it came this decline driven Among the series of global deals that published the case of satisfaction in the financial markets, which was the most important of Greece Agreement, which contributed to reducing fears of a Greek exit from the Europe nuclear deal Iran, which reduced the geopolitical concerns and unleashed forecast decline in global inflation with Iran return to market Oil which will lead to a decline in oil prices and therefore inflation falls addition to improved relations between the United States and Cuba.

All of the above, accompanied by a dissipation of fears of causing China’s new global crisis after contain the sharp decline in the Chinese stock market crisis was the reason for the return of the scene for a possible US Federal do to raise interest rates during the current year and that may be seen in the Market Committee Federal Open meeting for the month of September.
Comparing the current gold price with the summit, where he arrived in 2011, gold has lost about 40% of its value since the summit and until this moment.

Under the current basic data on the financial markets, paving the way for the possibility of falling gold further in the coming period. Since the height of the global stock and expectations for higher US interest rates before the end of the year that will keep away from gold investments remains most important is the technical factors which are related to psychological factors among investors in the metals markets and to what extent they can accept drop gold.
Speaking of technical factors, we find the current period and the existence of a series of important technical levels that may pose a real challenge to the bearishness on gold, these levels are concentrated between $ 1,000 and $ 1,100 an ounce.

The first level at 1070 and who managed until the moment of the gold support and push for the return of rising again on Monday, but it remains to support the average level in facing the gold physically strong support at 1030 levels, the highest level for the year 2008 and the level of $ 1,000 an ounce, which is a psychological level the most important facing the yellow metal during the coming period.

As a result of these technical factors, any new decline of gold will remain subject boosted the markets to overcome the power of support mentioned and get away from the psychological factors that may cause the cessation of gold fell simple time before conviction basics that are still suggest that this decline is only the beginning of a long journey we may see which levels temporary reprieve before the completion of the landing.

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