Spot gold is higher than comex gold futures after a very long-term time. Silver, copper and crude oil will remain firm on demand outlook and mine supply pressure. Trend of all metals, energies and US dollar Index till 2nd June can be misleading. Trend between 3rd June to 17th June will be sustainable. COVID is getting less attention now. Focus is on jobs and economy. COVID infections once world starts to open after 15th June will be crucial.
I just hope the over optimism on global economy is justified. Job losses are there. Net job creation worldwide is still negative. World is just focused on job cuts in G7 nations. Everyone has ignored job cuts in Asia. Job cuts in Asia is just the beginning and is far from being topped out. Commercial real estate rental will big see a big decline in India and all over Asia. Work from home has resulted in large corporates preferring to use owned office space. They have given notice period for vacation of corporate premises. I am seeing this trend in Gurgaon and Bangalore in India. Net real disposable income of people worldwide in on a sharp decline. Free money is at a historical high. Sharp corrections in gold will be short lived. Sharp corrections in gold should be used to invest for the long term.
China is preparing for an armed war with India. China is preparing to unleash a trade war with the world. China is rightly angry over American interference in the internal matters of Hongkong. Nations are giving more and larger infrastructure projects to domestic companies. They are sidelining Chinese corporates as much as possible. Internal sentiment is anti-leadership among the masses for the communist leadership. Armed war, trade war and hyper nationalism is the only way to increase approval rating. The sum of all this is that gold investment demand will rise. Physical gold demand for retail investment will set a net rise every month for the rest of the year.
COMEX GOLD JUNE 2020 - current price $1695.20
? Crash will be there if gold trades below $1693 today to $1675 and $1649.
? Gold has to trade over $1690-$1700 zone till Friday to be in immediate bullish zone.
MCX GOLD AUGUST 2020 - current price Rs.46281
Key Intraday support: Rs.46109.
Key intraday resistance: Rs.46646.
? There is a big support zone between 46036 and 46109.
? Bearish case: MCX Gold August will crash only if it trades below 46036-46109 zone (till 1st June) to 45436.
? Bullish case: If gold does not fall below 46036-46109 zone by 1st June, then it will rise to 47056 and 47466.
? Trend is down at the moment.
(prices are in Indian rupees above)
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