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Analysis of current gold short-term trades on the blockchain-based derivatives trading platform CloseCross reveals 55% are for the precious metal to increase in value between now and the end of September, while 20% anticipate a fall, and 25% foresee no change in valuation.

CloseCross CEO, Vaibhav Kadikar, said: “There are several conflicting factors impacting the price of gold. It is supported by persisting concerns about the Coronavirus crisis, a volatile global economic recovery, China’s regulatory crackdown measures, and increased geopolitical tensions.”

US monetary policy is a key factor in gold price

Kadikar said that US monetary policy is also a key factor in the price of gold and any tapering of bond purchases, or interest rates rising could see it fall. Inflation, which has been rising, will be one of the main drivers behind how monetary policies could change.

Demand for gold from central banks also plays an important part in the price of gold. Many investors paused purchases while responding to the worst of the pandemic, but they resumed buying gold this year and how this progresses over the next few months will have a big impact on its price.

No clear direction emerging on gold price yet

The gold trading data on the CloseCross platform still shows there is no real consensus as to what will happen to the price of gold in the short-term, Kadikar admitted.

The silver price has been trading in the range of between $23 and $25 in the last 30 days, and is still short of the $28 peak it reached earlier in the year. The gold price has also been fairly slugging over July and August. It is currently flirting with the $1800 level and in recent days has been trading in the range of $1795-$1840.

We have seen the USD increasing in the last three trading sessions and this has also contributed to the short term drop in the gold price through the $1800 floor again. Further positive jobs numbers out of the US this week is providing further momentum on the dollar trade.

Silver prices moving lower this week

Silver prices moved lower on Wednesday after rallying last week slipping through the support, and now the resistance level near the 10-day moving average at 24.13. Additional resistance for silver is seen near the 50-day moving average around 24.81. Support is seen near the August lows at 22.10.

CloseCross is regulated under MIFID II rules offering increased protection and transparency for customers. Unlike other trading platforms, there are no participation fees for using CloseCross, and its patented multiparty model ensures that leverage is not needed to achieve potentially outsized returns.


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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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