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Gold Price Analysis

April 21, 2024
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Josh Viljoen
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Josh Viljoen

Has gold been living up to its name as an inflation hedge?

 

Gold has often been touted by investors as an inflation hedge and a store of wealth. The commodity however has a mixed track record in recent inflationary periods and has not always delivered positive real returns for investors.

 

Gold Chart

 

The price of gold per ounce is current trading just above $1700. The commodity had an impressive run from mid 2018 to August 2020 and rose just shy of 80% during the period. However since then the price of gold has come under pressure and has been moving sideways over the last two years.

 

The gold price is currently trending towards a key level of support at $1700 dollars. If this support holds this could be a strong buying opportunity. However should the support level fail the price of gold could come down all the way to $1550 where the next level of support is. Following $1550 the next level of support after is at $1450.

 

If you are looking to go long gold I would wait for a strong bullish candle in the days to come to indicate a trend reversal as the momentum in price is currently downwards. However with further interest rate hikes looming I would not be surprised if gold had to make a further move lower in the coming weeks.

 

 


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