Weekly Summary (14/02/2022)
Price stimulated by 2 factors and medium-term price still greatly affected by rate hike issue
Spot gold rose sharply in last week which was reaching three-month highest position 1865. There are two main factors affected it: 1.Serious concerns about inflation as indicated by US inflation data. 2. The increasingly serious situation in Ukraine .
In terms of the situation in Ukraine, the Russian army has assembled considerable number of armed forces at the border, which can launch large-scale strike operations. The United States recently urged citizens in Ukraine to leave as soon as possible. White House security advisers believe that Russia may launch military operations at any time. However, the White House not sure whether Putin has made up his mind to use force. On Friday night, Biden talked with Putin on the phone and exchanged views on the Ukrainian issue. Biden believes that the United States and Russia are important powers in the world. Although the two sides have a competitive or even hostile relationship, they also need to consider the regional and world security situation and should not directly resort to military. Putin said that he would seriously consider the security treaty between NATO and the United States and would decide to publish it in the near future.
Judging from the current situation, although the two sides are at loggerheads, their views on maintaining regional balance and trying to solve the problem through peaceful are still consistent. It expected that new conclusions and views on the Ukrainian issue may be made this week and will still keep affect the gold price in the middle line, which is the main component of the current fundamental influence. The relatively serious geopolitical crisis also caused a serious decline in the US stock market and stimulated the rise of gold and silver products with risk aversion function.
The US Department of labor announced the US CPI on the 10th ,The data showed increase 7.5%, the largest increase since 1982,which was telling inflation in the United States had been very serious, because the quantitative easing and new infrastructure plan caused by the epidemic had caused surge amount money in the market, which led to sustained inflation and also increased the expectation and pressure of the Federal Reserve to raise interest rates earlier and expand the range of interest rate hikes in March, Although Powell had previously said that raising interest rates would not be achieved overnight and should be gradual, it was weaken in the face of fierce data performance,the market was still worried about inflation. Hawks in the local Fed also said that the Fed likely to raise interest rates by 50 points or more in March, but at present, the main figures of the Fed have not made a clear affirmation with similar views.
Generally speaking, the current medium-term price in monthly units still greatly affected by the interest rate increase and the expectation of interest rate increase. In the weekly range, we mainly need to pay attention to the situation in Ukraine.
Technical analysis: the fundamentals news guide the price and technical side needs pay attention to recent middle position
Gold: last week, the price was mainly affected by fundamentals news and increased significantly. Considering the information influence , The price may open lower on Monday and we need to pay attention to it. Last week, the price moved in the upper track range of brin channel as a whole. After entering the lower track for a short time at the end of the week, it rose sharply continuously pierced the upper track line and entered the high position range.
Silver: affected by information and gold linkage, silver adjusted speed was more rapid than gold. After the price rose to 23.70, it retreated sharply to 22.83. Then took the lead up to 23.68, forming a V-shaped reversal. The trend in the brin channel was similar with gold. After briefly entering the lower track it continuously pierced the brin upper track and closed showed upward trend.
Highlights and Strategies in this week: mainly pay attention to fundamental information and beware price correction
This week, we mainly consider the Ukraine situation impact in fundamentals news. At present, market main themes still believe that there has high possibility cause conflict and the price likely to rise further under strong stimulation. We need to pay attention to whether the United States and Russia have further communication and the tendency to use force.
With specific price trend, as the price driving force last week mainly came from risk aversion, it necessary pay attention to the retreat callback range this week. Profit lock can be considered for buy orders and also necessary to pay attention to the short jump and low opening possibility on Monday. In terms of specific price, pay attention to the 1850-40 key position . If it falls below the 1850-40 rang then price may further move towards the 1800 range. If it holds the 1850-40 range, the high position shock may become the market mainstream in this week.
In addition, the top needs pay attention to the further breakthrough of the price (not excluding the further impact of changes in Ukraine situation ) and mainly pay attention to the 1880 range. If it breaks through 1880, we can expect the 1900 position.
Important information in this week:
Tuesday: 21:30 US January PPI annual rate (%) (reflecting inflation)
Wednesday: 21:30 US January retail sales monthly rate (%) (reflecting consumption)
