Gold price set a record high! Three advantages, support precious metal market upgrade

category:Finance
 Gold price set a record high! Three advantages, support precious metal market upgrade


Analysts said that although the price of gold has been high, but under the three wheel drive, golds rising market is expected to continue, which is expected to impact the $2000 / oz mark.

A full explosion of precious metals

On the morning of the 27th, the international gold price surpassed the record high of US $1921.15/oz and reached a new high. As of 11:30 Beijing time on the 27th, London spot gold rose to the highest level of US $1940 / oz.

Source: wind

On Friday (24th), the international gold price once again crossed the $1900 / oz mark, hitting a record high of $1921.15/oz set in 2011. It is reported that this is the second time that the international gold price has broken through the 1900 US dollar / ounce level.

Source: wind

In the futures market, the main contract of Comex gold futures rose steadily, rising 2% as of 11:30 on the 27th, breaking through the 1930 US dollar / ounce barrier, exceeding the previous high of 1923.7 US dollars / ounce in 2011, and setting a record high together with spot gold.

Source: wind

In addition, by the end of the morning, the main contracts of Shanghai gold futures rose by nearly 3% to 435 yuan / g, a new record.

Source: wind

As the leading big brother, gold and silver assets echoed each other, and the precious metal market was fully ignited.

On the London market, spot silver rose in a straight line, and the intraday increase once expanded to more than 7%, which continued to set a new high in seven years.

Since the end of 2013, the main contract of Shanghai Silver Rose 81.4%, reaching a new high of 7.4% in 2013.

On the A-share market, the precious metal plate trend is strong. As of press release, the precious metal index (wind) rose nearly 8%. Shengda resources and western gold were trading, Chifeng gold was trading at one time, Shandong gold, Zhongjin gold and humon shares rose by more than 8%, Yintai gold and Hunan gold rose by more than 7%.

Source: wind

Three wheel drive is unstoppable in the short term

Why is the precious metal market irresistible and constantly surpassing imagination?

The answer may be the interwoven resonance of risk aversion, currency over issuance and the weakening dollar, which constitutes a three-wheel drive.

Third, the recent significant weakening of the US dollar has also significantly stimulated the price rise of precious metals.

While gold and silver prices have both reached periodic and even historic highs, the US dollar index has fallen to a relatively low level in recent years.

On the morning of July 27, Beijing time, the US dollar index fell below 94, the first time since September 26, 2018. As of 11:30, the dollar index fell to 93.83, a new low in recent two years.

Source: wind

The trend of the US dollar is weakening

Precious metals rise smoothly

The U.S. dollar index may be facing a strong and weak transition. On March 20, the U.S. dollar index broke through 103 for a time, then turned downward, and has been in the downward range since July. The weakening trend of the US dollar will have an important impact on the short-term trend of precious metal prices.

Xie Yaxuan, chief Macro Analyst of China Merchants Securities, believes that since 1973, the US dollar has run a two-and-a-half cycle, and will enter a continuous weakening trend in the future, completing the remaining half round of dollar downward cycle.

Shen Xinfeng, chief Macro Analyst of Northeast Securities, believes that the opening of the weak dollar cycle is the inevitable result of a series of factors, such as the end of the dollar shortage, the ineffective control of the epidemic situation in the United States, the inability of the U.S. economy to rebound in a V-shape, and the US Federal Reserves flooding of US dollar credit overdraft. Since the beginning of this year, gold prices have been approaching record highs, which is also evidence of the overdraft of US dollar credit.

CICC believes that looking forward, the U.S. dollar, which is at a historical high, is at the turning point from strong to weak, and is about to start a new round of long-term weakening trend. There are three main reasons for the long-term weakness. Firstly, the risk of EU disintegration has decreased significantly and the value of euro has been revalued; secondly, the security of US assets has been reduced due to the aggravation of political friction, and the currency selection of global foreign exchange reserves and other assets is expected to be more diversified, thus reducing the exposure to us dollar reserves; thirdly, globalization has stagnated or even regressed, and the demand for us dollar has decreased.

Xie Yaxuan predicted that the dollar index may fall by 30% in the future, returning to the level of around 70. According to the historical depreciation range of the US dollar and the changes of the high points in each round, it is estimated that the low point of the weakening of the US dollar index in this round may be about 70, but the process may take about 6 years. Xie Yaxuan believes that if the U.S. dollar tends to weaken, the exchange rates of euro, yen and RMB will strengthen, commodity prices will stop falling, and gold prices will rise. CICC believes that a weaker dollar will help create a good external environment for financial markets and long-term growth in emerging markets, as well as the performance of commodities such as gold. Shen Xinfeng also believes that the weakening dollar is good for gold, silver, crude oil and other commodities from the pricing level. However, dollar pricing is only one factor, and the trend of commodities with strong industrial attributes ultimately depends on its own fundamentals. Source: Yang Qian, editor in charge of China Securities Journal_ NF4425

Xie Yaxuan predicted that the dollar index may fall by 30% in the future, returning to the level of around 70. According to the historical depreciation range of the US dollar and the changes of the high points in each round, it is estimated that the low point of the weakening of the US dollar index in this round may be about 70, but the process may take about 6 years.

Xie Yaxuan believes that if the U.S. dollar tends to weaken, the exchange rates of euro, yen and RMB will strengthen, commodity prices will stop falling, and gold prices will rise. CICC believes that a weaker dollar will help create a good external environment for financial markets and long-term growth in emerging markets, as well as the performance of commodities such as gold. Shen Xinfeng also believes that the weakening dollar is good for gold, silver, crude oil and other commodities from the pricing level. However, dollar pricing is only one factor, and the trend of commodities with strong industrial attributes ultimately depends on its own fundamentals.