Gold price: going long gold
This week’s Trading the Trend sees IG’s chief market analyst Chris Beauchamp go long gold after the recovery in the price this week. This looks to be a continuation of the move higher from early July.
(video transcript)
Trading the Trend
Hello and welcome to IG's Trading the Trend for Wednesday, 26 July 2023. Let's look back at last week's Trading the Trend from IG’s senior market analyst, Axel Rudolph, which was to go a short wheat, which a week ago was trading around $7.27.
You can see here the stop the trade was to go short around this level as it hit the 200-day moving average. The stock was up above this February, high at 807 so we are still some way away from that stock, but certainly you can see the price has moved sharply higher since then, mainly because continuing concerns about that Russia- Ukraine rider, which is now completely extinct.
Really, it looks like the situation become more serious with Russian attacks on Ukrainian grain infrastructure, which has driven the price higher over the past week and could continue to do so if the situation escalates.
And while it hasn't hit our stock yet, it certainly isn't moving yet in our favour. But for the moment, obviously with the stop and risk management price, it is still an active trade.
Going long gold
Now, if we look to this week, for the week of Wednesday, 26 July, we're going to look at gold, which is seeing quite a bit of recovery the last couple of days after some weakness the end of last week and the beginning of this week.
And that follows on from a recovery from the lows of early July. You can see for gold, we were down around 1900 as July began, and then we finally got a rally that many have been looking for. It reached the 50-day moving average, moved sharply higher and then pulled back. But it has consolidated the past couple of days and started to move higher.
So, we look to go long gold for this week’s Trading the Trend with expectation that it continues to move higher. So, we're going to go long gold with the stop. We are going to have to put this, give it plenty of room because this is a longer-term trade. We're going to put our stop down back down to 1900 really to give it plenty of room.
So, we could see some volatility around, especially around the Fed meeting, all the earnings we've got over the next week or so. We're gonna go long gold with the stop at 1900 and then the target is over the course of time for it to move up towards these highs that we saw in the end of April, beginning of May of this year, up around $2,050 an ounce.
So that's Trading the Trend for Wednesday, 26 July. We're going to go long gold with our stop down at 1900 and our target at 2050.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
React to volatility on commodity markets
Trade commodity futures, as well as 27 commodity markets with no fixed expiries.1
- Wide range of popular and niche metals, energies and softs
- Spreads from 0.3 pts on Spot Gold, 2 pts on Spot Silver and 2.8 pts on Oil
- View continuous charting, backdated for up to five years
1In the case of all DFBs, there is a fixed expiry at some point in the future.
See opportunity on a commodity?
Try a risk-free trade in your demo account, and see whether you’re onto something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on a commodity?
Don’t miss your chance. Upgrade to a live account to take advantage.
- Analyse and deal seamlessly on fast, intuitive charts
- Get spreads from just 0.3 points on Spot Gold
- See and react to breaking news in-platform
See opportunity on a commodity?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
