Gold is strengthening after recent banking crisis – Technical headwinds ahead? [Video]

Nathan Bray from ACY Securities looks at the three factors pushing the Gold price higher and potential headwinds technically for the shiny metal.

The video begins with an explanation of the factors that typically affect the price of Gold. These include interest rates, inflation, and the risk off fear factor in markets. However, despite the fact that these factors have been negative recently - with interest rates high, inflation persistent, and banks facing challenges - the price of Gold has been soaring.

To understand why this is happening, the video delves into some of the less obvious drivers of the Gold price. One key factor is the global economic uncertainty that has been presented this week. This has led many investors to seek out safe haven assets like Gold, which they view as a reliable store of value in times of crisis.

Another important driver of the Gold price is the actions of central banks around the world. Many central banks have been engaging in large-scale monetary stimulus programs in an effort to combat the economic fallout from the COVID-19 pandemic and a battle with inflation. These policies have included massive bond-buying programs and historically low interest rates, which have created a lot of liquidity in the financial system. This flood of liquidity has led to concerns about inflation, which can erode the value of traditional currencies over time. As a result, investors have been turning to Gold as a hedge against inflation and a way to preserve their wealth.

Finally, the video explores some Technical Headwinds ahead for Gold. Overall, the video provides a nuanced and detailed explanation of why the price of Gold is soaring despite negative economic factors. By examining the complex interplay of factors that influence the Gold market, the video helps viewers gain a deeper understanding of the dynamics at play in the global economy.