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Gold Prices - An Overview of Gold and its Impact on Commodities and Currencies

14-12-2017 | No Views : 203

Gold Prices - An Overview of Gold and its Impact on Commodities and Currencies

Gold is a safe haven for investors when risk rises in financial markets. It uses time of economic crises as reserve stocks, gold has a direct correlation with oil, and vice versa is associated with the USD in an inverse relationship.
The price of gold has undergone many changes throughout history, between price stability, sharp rise in other periods and losses in later times. Gold is one of the most widespread metals in the world. It is used in jewelry and is also used as an investment, alongside trades.
And the many uses of gold as well as its relationship with the direct and reverse with other goods and currencies, also made the effects on the prices of many, and we will address the price of gold and changes that occurred since 1996 to the present day.

Gold prices over previous years

We observe the relative stability of the price of gold between 1996 and October 2003, as the prices in this period were moving in an accidental direction and receded between $ 256 and $ 386 per ounce, and the prices once again declined between $ 386 And $ 450 per ounce from November 2003 to September 2009, before the sharp rise began.
This is the longest period of stability for gold prices since 1996 to the present day, as with the beginning of September 2005, the precious metal began to rise to reach its highest price throughout history at the level of $ 1920 per ounce in September 2011.

 Gold prices over previous years

After the precious metal reached its highest level at $ 1920 per ounce, there was a period of fluctuation between September 2011 and March 2013, before starting to decline with the beginning of April 2013, which ended at $ 1046 in December 2015.
It is worth noting that the level of $ 1046 represents the lowest price of gold between 2009 and the present day, and the precious metal rose after he based on that level to start rising again to face resistance level at the price of 1350 dollars, which limited the completion of the ascension Gold failed to break through in 2016 and failed to break it again in 2107.
As mentioned above, the price of gold fluctuated significantly. We note that prices between 1996 and the fourth quarter of 2005 did not exceed $ 450 per ounce, and they started to rise above the $ 1,900 per ounce mark. Prices then fell again to reach levels $ 1240 per ounce in our current day in November 2017.

Gold prices and its relation to commodities and currencies

As we mentioned at the beginning of the lesson that although there are many influences on the price of gold, but it also has to do with many currencies and commodities, but in this lesson we will address the most recent relationship is the relationship between the price of gold at oil prices, and the relationship of gold prices in US dollars.

The relationship between gold prices and crude oil prices

Gold and crude oil are considered to be the most important commodities in the world because of their advantages and advantages. The specialists concluded that there is a belief that there is a strong positive relationship between the prices of gold and oil prices. When the prices of the precious metal rise, oil prices rise, and vice versa.
One of the causes of this relationship, experts believe, is that in the case of rising oil prices, the national income of the oil producing countries rises, which is reflected in the situation of purchasing people who are buying gold, which people tend to buy for boasting and adornment. This is in addition to investors who are investing in the precious metal Because of its high return and low risk,
Although there is a direct correlation between gold prices and oil prices, this relationship did not reach 100%, which means that in many cases the two commodities move in a different direction.

The relationship between gold prices and USD prices

There is a positive correlation between the prices of gold and crude oil prices as mentioned above, the two are linked inversely with the US dollar and the global gold price in US dollars, which increases the reverse relationship.
Gold is also a commodity used to hedge the risk of change in the exchange rate of currencies. It is possible for investors to buy gold if the goods contracted in US dollars are received, for fear of weakening the dollar.
The demand for speculation in gold, which is a safe haven during the time of economic crises, and the disposal of the US dollar, which is volatile at the time, which could cause heavy losses in the case of speculation.
The relationship between gold and dollar prices has not reached 100%, and we are likely to see Monday prices going in the same direction some times.

Technical Analysis of Gold Prices

Looking at the attached chart for the gold on the daily basis, we see a decline in prices to break the ascending trend line, which confirmed steady price below the level of 1262 which represents 61.8% Fibonacci of the wave price started at $ 1204 per ounce and ended at the price of $ 1357 per ounce.
The precious metal continued to fall until it rebounded on support at $ 1237 an ounce, which could cause gold to test the broken trend line. Even though the price is down, it might be a good buy opportunity to take advantage of the correction based on the reasons we will mention below.

Reasons may push gold for a corrective rally and a broken trend line test:

Gold is likely to rise for correction after breaching resistance at $ 1237, which represents 78.6% Fibonacci. The D point is the completion of the harmonic pattern of the Gartely Pattern, which may cause the metal to target $ 1262 per ounce.

Technical Analysis of Gold Prices

The formation of the harmonic trading model mentioned above is as follows:

  • Point B: At $ 1262 which represents 61.8% Fibonacci of the XA wave.
  • Point C came at $ 1298 per ounce, which represents 38.1% Fibonacci of the AB wave.
  • Point D: The complete point of the form that came at the price of $ 1237, which represents the 78.6% level of the XA wave.
The above harmonic trading pattern is not the only reason for the bullishness of gold prices for correction, but we note the positive positive price behavior in the chart and the RSI 14 for the saturation levels at the 30 level of the index.
We also note the positive cross of the Stochastic Momentum which is also raising the possibility of a corrective correction for the price of gold and targeting the price of $ 1262 per ounce.
Also, if the price drops to more than 200 pips and stability at the bottom of the support at $ 1222 is a sign of the completion of the decline, if the price then supported the behavior of a negative price.
Thus, we have a suitable opportunity to buy the daily trader at a level of $ 1262 with a stop loss at $ 1235 per ounce, and can stay out of the market and wait for the end of the correction and sell if negative price behavior.

Gold prices in Arab countries

Gold price in Egypt:

Price of the caliber 24: (711.72 Egyptian pounds - 40.7 USD).
Price of the caliber 22: (652.41 Egyptian pounds - 36.73 USD).
Price of the caliber 18: (533.79 Egyptian pounds - 30.05 USD).
Price of the gold ounce: (22136.84 Egyptian pounds - 1246.45 USD).

Gold price in Saudi Arabia:

The price of the caliber 24: (150.22 Saudi riyals - 40.06 USD).
The price of the caliber 22: (137.7 Saudi riyals - 36.72 USD).
The price of the caliber 18: (112.67 SR - 30.05 USD).

The price of gold in the UAE:

The price is 24: (147.15 AED).
The price of the caliber 22: (134.89 AED).
The price of the caliber 18: (110.36 AED).

Gold price in Kuwait:

The price of the caliber 24: (12.11 KWD).
The price of the caliber 22: (11.1 KWD).
The price of the caliber 18: (9.08 KWD).

If you want to get the daily gold price you can press the gold price, and the price for each country above is linked to the daily price of the yellow metal.
So we have finished talking about gold prices since 1996 to the present, which shows the sharp movements in the price of gold since 2005, and talked about the correlation of gold prices with oil, and the USD, and finally we dealt with technical analysis of the precious metal that fits with the daily trader.
Dear reader, if you are an investor and want to see long term prices based on the weekly and monthly timeframe, you can communicate with us to provide you with the analysis that is appropriate for your trading method.

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