Continue Trading Risk Premiums

Summary:

The market is absorbing the risk premium associated with the U.S. elections, leading to a continued surge in gold prices. Goldman Sachs anticipates that gold prices will rise above previous expectations, with a target set at US$2,900.

BUY XAUUSD

Close Time

CLOSED

2781.45

Entry Price

2889.00

2698.00

4829.05 +39.92 +0.83%

834.5

Pips

Loss

2698.00

2697.30

Exit Price

2781.45

Entry Price

2889.00

Fundamentals

The gold prices have continued its historic rise today, reaching an intraday high of US$2,789. This year, gold has demonstrated remarkable strength, with prices increasing by approximately 35% due to a variety of global factors driving investor demand.

As the market continues to absorb the risk premium associated with the U.S. presidential election, gold prices have sustained their upward trend. In the betting markets, Trump's advantage over Harris is widening, raising concerns about tariffs, inflation, and fiscal issues. Given the volatility of the electoral landscape and geopolitical uncertainties, maintaining long positions in gold and other defensive assets remains appealing in the short term.

Goldman Sachs projects that by early 2025, gold prices will reach US$2,900 per ounce, surpassing their previous forecast of US$2,700. This optimism is largely attributed to a surge in gold purchases by central banks, particularly those in emerging markets. Furthermore, Goldman Sachs anticipates that by December 2025, gold prices will increase by approximately 10%, reaching US$3,000.

Technical Analysis

The gold market experienced a significant rise on Wednesday, reaching a new historical peak. Technically, the overnight breakout from the trading range established over the past week is viewed as a new bullish trigger. Meanwhile, momentum indicators remain bullish.

If the bulls maintain their confidence, they may continue to drive prices higher, with the next target being the psychological level of 2,800. Given the current demand for safe-haven assets, upcoming events in the next week could lead to a stronger market rebound.

On the other hand, any substantial correction is likely to find solid support near the trading range. The initial support level is around the 2,750 range, and some subsequent selling could push gold prices further down to the intermediate support level of 2,732-2,730. This could be followed by a decline to the 2,715 range with the next significant level at 2,700. A breach of this level would open the door for a drop towards the next relevant support zone at 2,675.

Overall, due to ongoing concerns regarding major upcoming events in the U.S., the demand for this safe-haven asset remains robust, suggesting that gold prices may rise again.

Trading Recommendations

Trading Direction: Buy

Entry Price: 2757

Target Price: 2889

Stop Loss: 2698

Deadline: November 08, 2024 23:55:00

Support: 2757, 2735, 2717, 2708

Resistance: 2789, 2800, 2812, 2826

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