during the weekend, we had shared our views on gold might going to drop, and that really happened. from my personal view, I have found 3 reasons behind the Gold's flash crash early market opening.
1. Last week's massive US job market report.
2. Gold was raised when most of the central banks cut their interest rate to support their economy during the pandemic. Now, many central banks are thinking to increase the bank's rate again. August 18, RBNZ is going to hike their bank rate is expected.
3. Timing also may play behind today's Gold's flash crash. The time gold dropped, most of the time flash crashes happen that time. because of thin liquidity. U.S market is closed, UK/European they are in bed, Asian traders aren't out of bed yet. only Australian and New Zealand market is open those are a relatively small market.
So, now the question is, Will Gold Drop More?
Most possibly Yes. after the flash crashes, we have seen before the market goes for a big correction. that really happening in the market right now. This week the U.S has an inflation report to be released. if the come can meet expectation the FED has more chance to rake hike again this year. so, the Gold may drop again.
What about the technical analysis?
technically gold is in a bearish mode we have shared many times. From the present price zone, 1760 is the major resistance. breaking above 1760 is a hard job. in case It breaks above 1760, we may see more upward correction till 1790/1800 price zone. I think 1970/1800 is the perfect price zone for sell entry. as long as the market is below the 1760 price zone, there is still have a chance to sell Gold.
As usual, stop loss should be above the 1840 price zone. and the first target 9s 1725 and final target as we gave our last analysis is 1680/1680 zone. last analysis hit our target and bounced back from the 1680 price zone.
N:B: Don't rush for selling Gold immediately, let the market for correction and chart pattern or any news outcome.
I do not agree. The flash crash was either caused by someone looking to cover a short position at a better price or was caused by a margin call. No trader that was long gold in his right mind would sell 4B USD at the thinnest market hour. Never.
goldtradingexpert
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@gabrielgn, i didn’t mention just a reson. there i mentioned 3 reasons for gold's flash crash. any how, thanks for your comments.
goldtradingexpert
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@gabrielgn, Sir, do you know how much is the gold's total market cap? right now, 10.963 trillion dollars. in the last 7 days gold's total market cap dropped more than 4.85%. you can check it at 8marketcap dot com. without the flash crash that won't happen anymore. gold the is sector of nearly 11 trillion dollars market whether Apple company market cap only 2.437 trillion dollars only. so, 4 billion dollars is not a big matter for gold sir. hope you will research gold more. anyway, thanks for your comment.
goldtradingexpert
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ForexTrendline
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Awesome analysis, keep sharing! Here's what we have on GOLD as well
ram4nd
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Your reasons are not correct, banks dropped 4B worth of paper on the market.
goldtradingexpert
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@ram4nd, Sir, do you know how much is the gold's total market cap? right now, 10.963 trillion dollars. in the last 7 days gold's total market cap dropped more than 4.85%. you can check it at 8marketcap dot com. without the flash crash that won't happen anymore. gold the is sector of nearly 11 trillion dollars market whether Apple company market cap 2.437 trillion dollars only. so, 4 billion dollars is not a big matter for gold sir. hope you will research gold more. anyway, thanks for your comment.
46b8deea39294a3b87040bdb4c5de5
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You tell us why with inflation rising and low int rates why gold shouldn’t be $5000? There is a big disparity between the spot market and physical market. All the large bullion bars are gone. All bought up. If the day ever occurs when spot gold skyrockets the public won’t find any physical to buy or it will gone in days.