Gold Price Analysis For September, 2018
Gold has long been used as an alternative form of investment. There are many reasons to this, but the top 3 are at least: gold has been historically proven to hold its value, it has been one of the most important reserve currencies in the world especially during the weakenings of the U.S. Dollar, and it’s a good instrument to be used as a hedge against inflation (the price of gold tends to rise when living costs, due to inflation, increase). Gold itself generally gains more value than it loses because the supply is limited while the demand for it seems to always be steady, if not increasing (gold is not just a common investment or a shiny metal, but a highly consumed metal in multiple industries). In 2017 alone, gold gained a return of more than 10% – while this year, according to the S&P GSCI Gold Index by Dow Jones, the Year-To-Date (YTD) return for gold is at a negative 8.76% at the time this article was finalized (September 25th, 2018). Whether you’re new to gold investing or an experienced investor contemplating adding more gold to your personal stash/portfolio, let’s dive a bit deeper into gold’s price performance for the month of September 2018.
Gold started this month with a spot price of $1,202.60/oz. Despite starting out pretty strong, it dipped to $1,196.20/oz on September 5th, only to stabilize in the $1,197/oz area during the start of the following week. By the 14th of September, gold was on another journey downward, heading from a high at $1,208.20/oz on September 12th to $1,198.10 on September 15th. On September 21st, its price was recorded at $1,199.20/oz, which was a steep decline from its price the previous day of $1,209.00/oz. At the moment that this article was written on September 25th, 2018, gold is consolidating at $1,202.70/oz.
Gold spot price chart, taken from MoneyMetals
From the movement of gold’s spot price per oz, we can see that it is forming higher lows in the $1,196 – $1,198 areas during the last one month period. This is considered as a strong support line, where prices tend to bounce back up and not fall further than the spot it previously hit. From a technical analysis point of view, this also gives us hope that gold is – slowly but steadily – climbing up in price. As the U.S. Dollar also seems to be slightly losing its momentum, the general verdict for gold is bullish, that it will continue to rally higher if these conditions continue. The $1,202 and $1,209 resistance areas need to be breached, and if they are successfully penetrated, gold could reach as high as $1,450 per oz next year, which would make it approximately a 20.5% gain from its current price of $1,202.7 per oz.
Here are some other predictions and analyses by those who are involved daily in the gold trading business. Use the information provided below at your own discretion.
Neils Christensen, a financial journalist, remains unconvinced whether gold will be bullish or bearish. According to him, gold’s next price trend will be dependent on what the Federal Reserve has to say on any future monetary policies. A lower price could not be ruled out in the near-term, especially as interest rates rise up.
Nasdaq is quite sure that we ought to be prepared for further losses in the price of gold. According to their technical analysis, the Fibonacci area of 61.8% retracement is still very much a possible target, which will bring gold’s price down to $1,172 per oz. The bottom support is at the $1,146/oz area, which was also the 2017’s low for the gold spot price.
A contrasting analysis comes against Nasdaq’s through the work of Justin McQueen, a market analyst of the DailyFX team. From the data that he has gathered, it seems like gold is very close to its bottom, suggesting a bounce up and trend reversal that could make it bullish. He is also of the opinion that the support area around $1,200 might hold for now.
Despite different opinions, analyses, and views, if history is to teach us anything, gold remains a strong asset to hold and invest in. When gold’s price was first set in reference to the price of the US Dollar in 1791, it “only” held a value of $19.49 per oz. Since gold’s current spot price is sitting at more than $1,000 per oz, it has gained more than 5,030% of value within the last two centuries. This would make gold’s gain averaging at a nice figure of around 22.15% per year, which shows that it’s a good hedging tool against inflation.
It’s never too late to start investing in gold. We believe – as history has proven – that gold will continue to gain value over the years. If you’re also up to try new alternative investments, there exists quite a few, for example our DinarCoins, which is a mix of gold and blockchain technology. By combining the flexibility and speed of cryptocurrency and the hedging and investing aspects of gold, DinarCoin could be a great option to make your personal finances and investment portfolio become more flexible and diverse.
Disclaimer: all analyses provided here are not to be taken as financial/personal advice. We will not be held accountable for any potential losses from taking actions based on the information in this article. Please always do your own research and don’t just follow us blindly. If anything, this article serves an entertainment purpose and should never influence your decision in investing in gold in any way.