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Weekly Summary (20/09/2021)

Gold prices fell and difficult to recover in the short term. Market waiting for the Fed's interest rate decision

Last week the gold price basically adjusted downward with the lowest price of 1745. At the end of the week closed at 1752 which was hitting the lowest level of Sep. The main reason is the strong performance of retail data which far exceeded expectations. The market's concern about the policy shift of the Federal Reserve also put great pressure on gold. At present, the ability to drive gold prices upward is mainly driven by the still severe COVID-19 situation and the Federal Reserve's treasury bond plan.

At present, the market mainly focused on the Fed's interest rate resolution which will also announce economic expectations. According to the current employment data and retails data, the Fed is more likely to keep the interest rate unchanged but should pay attention on it. In addition, external factors such as the epidemic can not be ignored.

In August, CPI data increased by 0.4% which was unexpected to the market under the current economic situation. However, the impact of the epidemic still exists and commodity prices remain high and inflation remains high. However, the retail data also eliminated many worries about the economic outlook in the market. Next week's Fed policy meeting is becoming the focus and the outside world is full of expectations for quantitative easing and interest rate policy.

There will not be much information on the purchase scale of assets and treasury bonds at this resolution meeting but the policy adjustment may be implemented within this year. At present, the epidemic is still rampant and still is one of the main factors affecting the economy. Under the condition that there is no significant change in the number of confirmed cases, the Federal Reserve unlikely to make a significant adjustment to the policies of assets and treasury bonds. However, the pessimism of the August non-farm employment report may also weaken the Fed's decision to reduce or stop buying Treasury bonds. After all it needs greater employment growth to consider reducing bond purchases.

This week's fed interest rate decision will be the top priority of the short-term market. Even if the existing policy remains unchanged, it will also have an impact on the market. If there have a corresponding adjustment, it will lead to a new short-term trend. It is necessary to predict the market in advance and make the corresponding position layout.

Technical analysis:

Prices fell sharply last week due to US retail data. The moving average lines crossed down and entered a steady state. The two moving averages are entangled in parallel, the price runs relatively smoothly at the low level and the end of the week basically fluctuates up and down at 1750. After a short upward drive, there was a new round of decline on Friday and finally closed at 1752.
On MACD, the speed line basically moved below the zero axis in the late last week, and the price was relatively low. By the end of the market, the speed line crossed, and there was no driving force. The kinetic energy line is above the zero axis but there is no driving force, and the price is relatively stable.

The opening on Monday mainly observes the trend of MACD fast and slow line. If there is an obvious golden fork, it can be determined that there is upward momentum in the short term.

Important information this week:

Thursday: 2:00 US September federal funds rate meeting (%)

Thursday: 20:30 initial jobless claims in the United States for the week ended September 18 (10000)

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