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New Gold Bull Sees Price Reaching $ 1,700, Crypto Coins News

New Gold Bull Sees Price Reaching $ 1,700, Crypto Coins News


Marc Chandler believes that gold price will continue soaring. | Image: Bloomberg

It has been a dull month for gold as the previous momentum appears to have paused.

Since the start of September, gold price has declined by almost 2%, which is a surprise because of (the Federal Reserve rate cuta week ago.

Gold performance this year. | Chart: Trading View

Amidst the gloom, Marc Chandler believes that the price of gold will continue moving higher. He believes that bullion will hit $ 1, 700 this year, which implies a 10% upside from the current price.

Chandler is one of the best-known foreign exchange strategists in the world. He is the chief market strategist forBannockburn Global Forex, which is a capital markets firm that specializes in advisory, analytics and transaction processing for companies. First Financial Bank recentlyacquiredthe company for an undisclosed sum. He also runs theMarc to Marketblog, which is a leading foreign-exchange related blog .

New Gold Bull Reiterates Bullish Call

Chandler first unveiled his bullish call on gold in an interview with Bloomberg in June this year.

In an exclusive email interview with CCN, he reiterated what he had said initially about gold. He continues to believe that negative interest rates, geopolitical constraints and technical factors mean that theprice of goldcould keep moving higher. He said:

Negative interest rates mean that the opportunity cost of holding a non-yielding asset has fallen.

Just last week, the Federal Reserveslashedinterest rates by 25 basis points. This was the second consecutive interest-rate cut in as many meetings. Some analysts believe that the Fed could have another 25 basis point cut this year. Others, likeRon Paul, think that rates could go negative in 2020.

The situation is not improving around the world. On September 12, theEuropean Central Bankpushed rates further negative and pledged to do more. In Japan, the BOJannouncedthat it might cut rates as the economy continues to weaken. Other major central banks, with the exception ofNorges Bank, have taken a dovish stance on their economy.

On geopolitical issues, Chandler pointed to the continued weaponization of the dollar by the US He said:

As the U.S. continues to weaponize access to the dollar market, central banks like Russia, China, Turkey are accumulating gold.

In recent years, the US has continued to weaponize the dollar by placing sanctions on various countries and entities. This has led to massive purchases of gold by these central banks. In April, Russia’sgold reservesrose to a five-year high. They currently stand atmore than $ 500 billion. China too, has increased its reserves tomorethan $ 88 billion.

Further, there the geopolitical situation in the Middle East appears to be deteriorating. Just last week, the biggest oil refinery in Saudi Arabia wasattacked. This could worsen an already tense situation in the region.

On the technicals, Chandler said that:

My reading of the charts suggests a target of around $ 1700 when it moved above $ 1400. I did not see a likely 20% move in competitive assets like stocks or bonds or forex.

This year, the price of gold has soared by 18 .7%, which is slightly better than theDow Jonesperformance of 15% but lower than theS&P 500gain of 19%.

Last modified (UTC): September 23, 2019 2: 05 PM

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September 23, 2019 2: 30 PM

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