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Gold price SOARS and forecast to rise higher amid North Korea’s latest missile strike | City & Business | Finance

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Values of the precious metal crashed through the $1,300 mark to reach an 11-month high, as investors rushed to shelter money after the latest missile from North Korea flew over Japan.

Gold is considered a safe haven for money and prices rise in times of market and political turmoil.

Kim Jong-un’s warmongering actions have now pushed prices to around $1,326.

Japanese prime minister Shinzo Abe added to worries when he called North Korea and the missile an “unprecedented” threat to the country.

Gold has also seen its value increase amid a weaker dollar, which has helped to attract foreign investors.

Fawad Razaqzada, market analyst at Forex.com, said: “Sentiment has been hit above all by raised geopolitical concerns after North Korea fired what is thought to be a ballistic weapon over northern Japan in the early hours of Tuesday.

“Some experts think that the missile could be powerful enough to potentially carry a nuclear warhead.

“Investors are concerned that this may lead to retaliation from not only Japan and South Korea but the US too, especially given the rhetoric Donald Trump deployed a couple of weeks ago.

“This is good news for gold, for not only is it benefitting from the current ‘risk-off’ trade but a weaker dollar too.

“The fact that the EUR/USD has surged above 1.20 psychological hurdle is also positive for gold, given the metal’s strong positive relationship with this currency pair.”

If tensions calm, the price of gold could fall back.

But if North Korea continues to provoke a reaction and Mr Trump takes a hard line against the rogue state, the metal’s value could jump higher.

Mr Razaqzada added: “We may see a pullback amid profit-taking here before the next potential up leg unfolds.

“Specifically, gold could drop to support levels at $1311/12 or even $1295/$1300 before pushing higher again.

“The next bullish objectives would be at $1337/8, the November high; followed by $1352, the 161.8 per cent Fibonacci extension level and then $1375, the 2016 high.

“However should gold eventually break below the $1276 swing low point then this would end the bullish bias.

“Unless that happens, we are expecting to eventually see higher prices in the coming days and weeks.”


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