Header Ads

Header ADS

Weekly Summary (21/02/2022)

Last week market review :

Last week, prices mainly showed an upward trend with the highest price breaking through 1900 to 1902, half year new high position,which also continues the upward trend of the previous two weeks. the trend fluctuated at a high level and closed at 1896 in the end market. Silver Rose 24.07 from 23.05 and closed at 23.93.

Last week's rise was mainly driven by geopolitical factors in fundamentals level. There were many variables in Ukraine last week and the actions of all parties were larger. Those Factors such as the presence of soldiers on the border and armed mobilization of both sides made the outside world believe that the possibility of military conflict was greatly intensified, which hit the stock market and promoted the sharp rise of spot gold and silver and other trading products with risk aversion properties. In addition, the Fed did not respond to the rumors of substantial interest rate hikes from the outside world and turned to more moderate attitude on the issue of interest rate hikes, which also made the expectation of interest rate hikes unable to compete with geopolitical factors, which was also the main factor in the rise of gold and silver products.

Fundamental information: Geopolitical huge push + expected interest rate hike double swords continue to drive gold prices

On the 14th , the United States closed the Embassy in Ukraine in Kiev and transferred diplomats to the relatively safe area in the Ukraine near Europe area. At the same time, it called on American citizens in Ukraine to leave the country as soon as possible. Other western countries have also responded positively and issued danger notices to their citizens in Ukraine one after another. These measures have caused certain tensions and great shocks in the financial market due to the situation in Ukraine, which is already on the brink of war. After the incident, the short-term price of gold rose sharply, approaching around 1880.

The next day, Russia announced the withdrawal some armed forces which were participating in the exercise with Belarus from the border and announced that the exercise had ended,its subordinate ministries had returned to the Russian as original plan. This behavior also directly stimulated the gold price and made it fall back in the short term. However, with the remarks of the Intergovernmental heads, the gold finally broke through the 1900 mark.

From the current situation, all parties involved in Ukraine issue have shown calm and restraint. This week, the US Secretary will hold talks with the Russian foreign minister and there are signs of gradual easing of the military confrontation between the two sides at the border. But Biden said on Thursday that Russia had made up its mind to invade Ukraine, which once again exacerbated tensions.

According to the Fed meeting record released on Wednesday, policymakers believe that economic inflation already very obvious, the adverse impact on the whole economic system has begun to highlight and the employment market data was too high, the tightening policies should be considered. 

As the fundamental information that can predict that affect the market in this week mainly the situation in Ukraine. At present, geopolitical + risk aversion still the main theme of the market. In addition, there has no obvious sign of easing optimism in the situation in Ukraine. It is expected that this supporting information will continue to maintain the high level of gold prices, fluctuate or even break through in this week. Pay attention to the attitudinal remarks made by relevant politicians which may cause market shock.

Technical analysis:

Gold: the price keep higher position above the clouds and there has room for correction in the future.

On the 1-hour interval of the ichimuku chart, the price started above the cloud at the beginning of last week, then crossed the cloud and went up, crossed the benchmark and stabilized, then remained stable above the cloud. The upward trend obvious and stable. 1850 still a key position. In last week's market, 1850 was repeatedly touched ,after the price rose ,it was holding in 1850. We still need pay attention to the key position 1850 in this week. After the price correction, we need pay attention to whether it will breaks through 1850.

Silver: the channel keep stability and high probability keeping in future 

Within the 1-hour interval of brin line, the rising channel of silver price is relatively stable, the overall curve very smooth,which is smooth and complete as a whole. It shows that the market sentiment relatively consistent and the future market still has the driving force and momentum for stable rise. Need to focus on the 23.00 location.

Basic strategy in this week:

The main tone of this week is still basically high-level consolidation + upward breakthrough. The most important factor which will control the market is the situation in Ukraine. Focus on the remarks of relevant politicians and military trends that may affect prices in the short term, such as changes in border military strength, troop withdrawal, exercises and so on. If the situation stabilizes, there may be a short-term correction in prices.

Gold focuses on the lower range of 1880-1850. If the price breaks through 1900, we can focus on the upper range of 1920-50.

Silver focuses on the lower range of 23.00-23.40. If the price stabilizes and continues to break upward, we can focus on the range of 24.00-24.20.

Important information in this week:

Thursday: 21:30  US GDP annualized quarterly rate in the fourth quarter (%)

Powered by Blogger.