Last week, gold reacted to the USD weakening rather than its own fundamentals, which keep indicating a rally. In particular, GOFO rates remain negative.
At the same time, the gold backwardation is strengthening. The chart below indicates the percentage difference between futures:
At this point, the figures indicate the all-time high. It has a positive value. This tells us that the demand for gold with instant delivery is equal or higher than the demand for gold in the near future. In other words, investors do not want to wait and strive to purchase the metal instantly.
Still, gold doesn’t seem to show major signs of a strong rally. It keeps showing negative correlation with the U Dollar. The current level of correlation is expected to stay unchanged until the People’s Bank of china or Bundesbank reveal their gold reserves. If the correlation changes before those reports, this will indicate that there has been some insider leak and the market started reaction accordingly.
GBPUSD and EURUSD may see retracement.
The chart below, courtesy of Masterforex-V Academy, reflects the current state of affairs in the market of gold:
P.S. По рынку золота на данный момент рекомендаций нет.
