Gold price at an elevated level – the current situation

Gold has risen from a high of $ 1,620 yesterday morning to a peak of $ 1,673 tonight. With currently $ 1,654, the precious metal can currently maintain this higher level. The development in gold is astonishing when you look at it (we talked about it yesterday) in relation to the stock markets. In the course of the entire stock crash, the gold price held up much better than Dax, Dow and Co. The following chart shows the trend of gold in red-green compared to the Dow 30 on a CFD basis in blue since last Wednesday.

 

Gold price rises in parallel with share prices – and ETF inflows

Gold prices and stock markets have recently risen in parallel. In the big stock crash, many investors quickly needed cash and therefore also sold gold. Now this constraint has disappeared (for a short time?) And gold is also bought again. Will the hard test for the gold price only come when the stock markets may crash again in the next few weeks? Then gold could show whether it can remain stable as an escape port at high prices. But apart from that, the real urge from small investors to gold now seems to be impacting the gold price again. The prospect of a long hard recession, further interest rate cuts, money pressure orgies from the central banks and government debt that will explode shortly – all of this is driving many investors to gold.According to investing.com’s Geoffrey Smith, the price of futures versus physical goods recently rose to its highest level in over a week amid the massive inflows in gold ETF and other gold-backed products. Gold inventories rose 1.5 million ounces last week and, according to BMO analysts, have increased 10 percent in physical gold claims since the beginning of the year. Much of this increase went into US-backed ETFs that replicate the Comex price, not the London price.