Gold prices on Friday skyrocketed amid the continuing shocks being felt in the current US banking crisis, marking the highest price in four months.
The price rose from $1,920 per ounce on opening to a day high of around $1,989 per ounce.
Reuters on Friday reported: “Gold prices surged more than two per cent on Friday as a wave of banking crises shook global markets and put bullion on track for its biggest weekly rise in three years, while bets solidified for a less aggressive Federal Reserve in its fight against inflation.
“‘Gold is surging on fears that more bad banking news could appear over the weekend and hopes that the Fed will pause its rate hikes next week,’” said Tai Wong, an independent metals trader based in New York.
“The collapse of Silicon Valley Bank in the US has highlighted banks’ vulnerabilities to sharply higher rates, while a rout in Credit Suisse shares has added to the market turmoil.”
Gold’s momentum continued at the start of this week, with a day high of around $2,009 per ounce, the highest rise recorded in the past four months.
However, it ended Monday in bearish fashion, followed by Tuesday seeing a drop from $2,009.75 to $1,935.56 per ounce.
But as of Wednesday, the daily trend for gold was again bullish, with an opening price of $1,939.51 per ounce.
“The dollar and stock markets slid, making bullion a more attractive investment. While it is considered a hedge against economic uncertainties, gold’s opportunity cost rises when interest rates are increased,” Reuters added.
With the price of gold testing $2,009 per ounce and retracing to around $1,935, PP Link Securities business manager Chhea Chhayheng said it already pointed to a continuing uptrend for gold.
For this week trading recommendation, investors and traders could consider trading gold in the range of $1,905 to $2,009 per ounce, with an average price of $1,965 per ounce.
