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Gold price climbs to life-time high on bank crisis in US. Sell, hold or buy?

The gold price has been on a steady climb in recent years, and the latest bank crisis in the US has pushed it to a new all-time high. With uncertainty and volatility in the markets, investors are wondering whether to sell, hold or buy gold. In this article, we will explore the current state of the gold market and provide insights on whether investors should sell, hold or buy gold.

Introduction: The state of the gold market

The gold market has been performing well in recent years, driven by a range of factors such as economic uncertainty, geopolitical tensions, and low interest rates. The latest bank crisis in the US has pushed the gold price to a new all-time high, as investors seek safe-haven assets in uncertain times.

Should investors sell gold?

While the gold price has been on a steady climb, there are some factors that could suggest it may be time for investors to sell. If economic conditions improve and the market stabilizes, the demand for safe-haven assets such as gold may decrease. Additionally, if interest rates rise, this could make other investments more attractive than gold, potentially leading to a decrease in demand.

Should investors hold gold?

For many investors, holding gold is a long-term investment strategy. Gold has a long history of maintaining its value and serving as a hedge against inflation and economic uncertainty. While there may be short-term fluctuations in the gold price, holding gold can provide diversification and stability in an investment portfolio.

Should investors buy gold?

For investors who are not yet invested in gold, now may be a good time to consider buying. The current bank crisis in the US, combined with ongoing geopolitical tensions and economic uncertainty, make gold an attractive safe-haven asset. Additionally, with interest rates low, there is less competition from other investments that may offer higher returns.

Conclusion: Sell, hold or buy?

The decision to sell, hold or buy gold ultimately depends on individual investment objectives and risk tolerance. While there may be short-term fluctuations in the gold price, the long-term outlook for gold remains positive. With ongoing economic uncertainty and geopolitical tensions, gold continues to serve as a safe-haven asset for many investors. However, investors should also be aware of the risks involved in investing in any asset and seek professional advice before making any investment decisions.

Gold Price Today: Due to the US bank crisis, the price of gold has increased to an all-time high of 59,461 per 10 grams on the MCX, surpassing the previous record of 58,847 per 10 grams set on Friday. The price of yellow metal increased by $1,414 per 10 grams over the previous weekend’s closing price, indicating a weekly gain of around 5.86%. per 10 grams, 56,130. Gold completed the week at $1,988.50 per ounce on the international spot market, up 6.48 percent from the previous week’s closing price of $1,867.

Experts in the bullion market claim that gold prices are currently comfortably above the significant resistance level of $1,930 per ounce and are on track to reach $2,000 per ounce in the global market. The MCX 57,500 and 56,800 levels have provided support for gold prices, and the yellow metal is poised to touch these levels. As the price of the precious metal rises to Rs 60,000 per 10 grams in the near future, the prognosis is still favorable.

Sugandha Sachdeva, a market expert, explained the current bullish trend in gold prices as follows: “Gold prices increased as a result of the unrest caused by US struggling banks and the dramatic decline in shares of Credit Suisse, a major Swiss bank. In order to protect their investments and serve as a store of wealth, investors are turning to gold.”

US dollar correction

Sugandha Sachdeva commented on the consequences of the ECB’s rate hike, saying, “The ECB startled the markets with a rate hike of 50 bps, neglecting the impact of higher rates on the banking sector, which led to a fall in the price of the US dollar to the euro.” Silver prices increased in unison with gold prices, rising by roughly 9.22% for the week, as the new economic forecast highlighted flaws in the banking system and fueled demand in precious metals. got a great profit.

gold receives safe haven appeal

Vice President of Research at IIFL Securities, Anuj Gupta, stated that the rising US bank crisis was to blame for the dollar index’s drop. Equities, treasury yields, bonds, and other assets have been under pressure as a result. As a result, investors are withdrawing funds. If you want to be protected from the current unrest, invest in these things and gold.

US Fed is in focus

According to Anuj Gupta of IIFL Securities, the outcome of the US Fed’s FOMC meeting, set for March 21 and 22, 2023, would be crucial since a rate hike by the US Fed could cause gold prices to rise even more.

Sugandha Sachdeva predicted that the US Fed will shift to a more dovish stance and that the failure of three significant US banks—Silicon Valley Bank, Signature Bank, and First Republic Bank—had increased confidence in this outcome. An aggressive withdrawal of the aggressor is possible. Tension.

The demand for gold will increase versus the dollar and the opportunity cost of keeping a non-yielding asset will decrease with any pause in the Fed’s rate-hike cycle, according to Nirpendra Yadav, senior commodity research analyst at Swastika Investmart. The Fed will likely continue to be accommodating with regard to monetary policy, though, as long as inflation stays stable. Investors are urged to exercise caution ahead of the US Fed meeting because it is unknown how much of an increase in interest rates will be made.

gold price outlook

Sugandha Sachdeva stated the following regarding the short-term forecast for gold prices: “Gold prices comfortably crossed the major hurdle of $1,930 per ounce in the early part of the week, turning the view for the coming week optimistic.” signs that the momentum will continue. Even the highly anticipated Fed meeting results may cause turbulent volatility, gold appears ready to test levels of around 60,000 per 10 grams and $2,000 per ounce in the near future. The price of the precious metal is supported by key levels at 57,500 per 10 grams and thereafter at 56,800 per 10 gram.

Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint. We advise investors to check with certified experts before taking any Investment Decision.

Also Read: Jindal Steel, Tata Steel, NMDC shares

FAQs:

  1. What is driving the gold price to a new all-time high?
    Answer: The latest bank crisis in the US, combined with ongoing geopolitical tensions and economic uncertainty, has pushed the gold price to a new all-time high.
  2. Should investors sell gold?
    Answer: Whether investors should sell gold ultimately depends on their individual investment objectives and risk tolerance. If economic conditions improve and interest rates rise, the demand for safe-haven assets such as gold may decrease.
  3. Should investors hold gold?
    Answer: For many investors, holding gold is a long-term investment strategy that provides diversification and stability in an investment portfolio.
  4. Should investors buy gold?
    Answer: For investors who are not yet invested in gold, now may be a good time to consider buying. The current economic uncertainty and low interest rates make gold an attractive safe-haven asset.
  5. What risks should investors be aware of when investing in gold?
    Answer: Investors should be aware of the risks involved in investing in any asset, including fluctuations in price and potential changes in economic conditions or government policies.
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