- Since the start of trading this week, the gold price has been moving in a narrow range and is stable around the $2035 per ounce level at the time of writing the analysis.
- As we mentioned before, the performance may remain within a narrow range until the reaction of the markets and investors, and the US dollar price to the announcement of the US growth reading and the inflation reading preferred by the US Federal Reserve.
On the front of global supply and demand for gold:
China's gold imports in January via Hong Kong rose to their highest levels in 6 years amid festive spirit. Also, official data showed this week that China's monthly net imports of gold via Hong Kong rose by 51% in January, reaching their highest levels since mid-2018, as customers accumulated the precious metal in preparation for the Lunar New Year festival.
For its part, the World Gold Council said in a note this month: “As domestic assets including stock and real estate markets witnessed weak performance, the strong performance of the renminbi gold price in recent months attracted investors who sought safe haven assets.” Added, “This has led to the continued popularity of gold bullion and coins, resulting in a lively replenishment for industrial and commercial banks on the occasion of the Chinese New Year holiday,”. the World Gold Council ended, adding that wholesale gold demand saw its strongest January on record.
Meanwhile, data from the Hong Kong Census and Statistics Department showed that net imports to the world's largest gold consumer reached 76,248 metric tons in January, compared to 50,381 tons in December. Recently, total gold imports through Hong Kong, which include re-exports, jumped 37% to 81,967 tons.
Moreover, Hong Kong data may not provide a complete picture of Chinese purchases, as gold is also imported via Shanghai and Beijing. The People's Bank of China controls the amount of gold entering the country through quotas to commercial banks. Currently, China had held 72.19 million ounces of gold at the end of January, continuing the buying spree that began in November 2022. In this regard, ANZ analysts wrote in a note that restocking ahead of the Lunar New Year holiday in China saw a record high in wholesale demand at 271 tons. metric in January, adding that China's spot gold premium indicates healthy physical demand. Last month, Chinese traders sold gold at premiums of up to $57 an ounce over global benchmark spot prices.
Gold Price Forecast and Analysis Today:
Based on the performance on the daily chart above, bullish control over the direction of gold price persists, and the current trend may strengthen if gold prices move towards resistance levels at $2055 and $2070 per ounce. Obviously, this could occur if the gains of the US dollar halt and global geopolitical tensions increase. Conversely, during the same time period, a reversal to a bearish trend will not occur without a move towards support levels at $2000 and $1985 per ounce, respectively.
Finally, we still prefer to buy gold from every falling level.
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