Gold futures declined sharply on Wednesday as risk perception continued to improve, with investors anticipating a rapid recovery from a coronavirus-driven economic downturn with investors easing civil unrest in the United States.
The market is under pressure as strong global equity markets are forcing investors to rethink their long hedge positions in gold. As the stock rises, investors take away some of their gold holdings.
Short-term gold bulls may be severely punished at this current move, especially if all three major US stock indices reach or exceed all their higher levels.
Investors are shedding all so-called “safe-haven” assets, including Treasuries, Dollars, and Gold. Treasury yields can be especially punishing for gold investors because gold does not pay you anything to keep it.
Those who bought gold due to civil unrest pushed by news services, and some analysts turned their heads to them because they had forgotten the key rules – interest rates control the direction of gold, not something that Michigan does. Chicago is robbing a store on Avenue.
Daily Chart Technical Analysis
The main trend is down according to the daily swing chart. The trend subsided on Wednesday when sellers pulled the final swing down to 45775. When buyers pull out the previous main top at 47300, the trend will increase.
The short term range is 44780 to 48000. It has a potential resistance at 47200.