XAU USD to 2100 in 2021?

21 Oca 2021

Purple = weekly
Blue = Monthly
Orange = Daily

Hello Traders and Analysts,

The following analysis will be in depth to explain the out look of the Index and

Based on what merit?
Being a commodity based inflation hedge - the orange zone at $1800 - 1805, this zone has been a great opportunity for the Yellow metal to keep its continuation moving against the bears attacking the 1800 zone.
The established previous all time high from a perspective of the profit taking upon gold, SPX and global efficiency of accumulating further debt in the world economy buy governments buying back bonds producing limited yields, and the USD index showing further melting pots into the Swissie to combat inflation - it is clear governments are looking for the continued spending to occur. See [USD CHF]

Note - with the successful inauguration yesterday of the 46th President, the world turns on a fundamental level for key drivers to break the
daily zone in orange, between $1856 - 1862.00


ASX
With the ASX correlated with the S&P500 - we expect the ASX to over extend the Fibonacci targets to the upside into 2021 upon the global recovery.

See below for the correlation of ASX & SPX recovery


XAG USD
While majority of investors over look Silver as a commodity to Gold, do not under estimate the return it can produce for investments.
While the correlation
We have seen a nice impulse into the channel and a rejection upon reaching the zone of $29.00.
Good question, based on the fact - from a technical standpoint - the sell off back in February, March 2020 - reversed on a fractal point within the market structure to the crisis of the reluctance for the demand of the Commodities . However, this produced a demand zone to hold from so we have a buying opportunity.

Fundamental note:
With the production continuing from South America and Central America - the largest producer [Mexico] who are also a commodity based currency, expect further growth against the USD on this pair with continued other prosperity from the country, not purely based on Silver.

This imbalance was created in which created the impulse. Price re-established itself now between $22-27 zone for a further imbalance where price will now look to as a strong demand for price engineering if needed.

XAU XAG - correlation chart

The correlation shows Gold / USD with the USD's likely impact on gold, and Silver / S&P correlation means general stock market's likely impact on silver value. Of course, the price of gold impacts the profits, and share prices a like of all gold producers.

Updated view for 2021 on XAG

SPX
See the outlook below for 2021 full analysis breakdown:

Based on what merit?
Good question, based on the fact - from a technical standpoint - the sell off back in February, March 2020 - reversed on a fractal point within the market structure. Where price had a low of 2182, this significant point to me, showed the imbalance between the previous Fibonacci extension points 1.786, 1.618. This was essentially fulfilling the swing high and creating a swing low.
Refer back to 2007-08 on the chart to see the imbalances - where; the blue Ellipse - shows the 2008 rally distribution beginning to take effect.
The Red Ellipse - shows the pivotal 1.7186, 1.618 full retracement zones - where the "china trade war" and "coronavirus" fundamentals took place for the index to fall back in line

What can we see?
we can see here that the price reversed directly between the previous extension zone to create a new inflow first touch to close out the imbalance between the buyers and sellers.
Shorts were closed and further longs were taken to bolster investments or if investing in a long term portfolio, a further contribution added upon the compounding value.

Four sectors returned a higher value than the S&P500 close in 2020 adding optimism within adding inflows into the market to 2021 - beyond.
With all other major indexes and rapid new industries taking off - what we will be able to see?

The current bullish momentum will be created from the stimulus coming further into 2021, presidential change and USD index or DXY being suppressed. This projection offers the rate of debt the debt market cycle has not been reacting negatively yet with yields still intact and further debt creation to refinance debt obligations.

The final pair to assess is GBP JPY

With the successful Brexit transition and recovery from the Risk-off scenario from Brexit, the commodity hedge from Gold will not push higher. While the vaccination and cases remain a concern for the UKs long term success in the economy opening up, the GBP has been seen rising and looks set to continue with a target of 143 poised to be filled by the bulls.
XAU USD & GBP JPY are safe havens so expect the volatility within the pairs to remain strong as short term sentiment turns sour.

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