Overweight gold news to stimulate gold prices higher

On Wednesday (22nd) spot gold once again rose sharply, and set a new high of 1,781 US dollars to close at 1,777.91 US dollars per ounce, up 21.81 US dollars per ounce, or 1.24%, the highest hit 1,781.40 US dollars per ounce, the lowest dropped to 1,749.10 US dollars / ounce. The news that the global central bank is about to increase its holdings of gold stimulated the price of gold to soar in the late afternoon of New York. The reputation of Greece was lowered to the worst level of waste by Citi. The gold price was once tested by the support of the previous 1752 and pulled back. The US dollar also triggers a large number of ** buying orders and quickly rises.

Fitch downgraded Greece to the worst junk grade "C". Fitch Ratings Agency downgraded Greece’s credit rating from “CCC” to “C”, suggesting that Greece’s default is expected to be imminent. Fitch reiterated that it believes that the debt replacement agreement with private bondholders in Greece is a "deadly replaced bond" that will result in a limited default rating. After the announcement of Fitch’s announcement, the benchmark 10-year Treasury bond in Greece was lower, and its yield rose by 63 basis points to around 34.05% in European trading on Wednesday. Fitch also stated that after the completion of bond swaps, Greece’s sovereign debt rating will embark on a limited default and will be reclassified to the company’s rating based on the assessment of Greece’s post-default structural and credit conditions. By this news, the dollar was strong and the gold price once sought support of $1,752, and quickly pulled up.

Optimism about Greece’s debt agreement soon dissipated, and traders are assessing Greece’s long-term prospects with the euro zone. In the fourth quarter of last year, Greece’s debt-to-GDP ratio reached 160%, and investors have reason to believe that the Greek issue will soon return to the table again. The price of gold is still affected to a certain extent.

European economic data shows that the initial value of the comprehensive purchasing managers' index in February of the 17 countries in the euro zone unexpectedly declined, indicating that business activity in February has shrunk.

US economic data, the National Association of Realtors reported that the US’s second-hand housing sales increased by 4.3% in January, and annualized data rose to 4.57 million, but lower than the market’s average forecast of 4.7 million. This data shows from another aspect that the US real estate market may be stabilizing. However, the overall real estate market is still relatively weak, but it will appear at the bottom of the next few quarters.

On Wednesday, the U.S. Obama administration proposed to reduce the corporate tax from 35% to 28%, while eliminating dozens of other tax cuts. The White House’s tax plan, especially the one that may increase the partial tax rate, will have a negative impact on most investors.

The situation in Iran is still receiving market attention. The Iranian military situation and the impact of rising energy prices are somewhat worrying. Consumers are most reluctant to see gasoline prices rise to $4 to $5 per gallon. Oil prices rose again during the session yesterday.

The market has received mixed news. Including the improvement of employment trends in the United States, the solution to the Greek debt crisis has brought about significant stability, low interest rate policy and the recent implementation of the third round of quantitative easing policies transmitted by the Federal Reserve meeting. However, the Greek debt issue is not yet over. There are still a lot of things to do. The price of gold is now the most sensitive to the Greek issue, and the Greek election is nearing the end. Even if the progress of the new Greek agreement is as planned, the Greek debt crisis still has a long way to go from the end. This agreement will help the creditors to get paid because the aid funds will be deposited into separate accounts to ensure that the interests of the creditors will be In the first place, it was unable to help the Greek economy to recover in a short time.

The world's largest gold exchange deal** (ETF) - SPDR Gold Trust's gold holdings as of February 21 increased by 0.31 tons to a level of 1,281.59 tons.

The news that the major central banks in the world are about to increase their holdings of gold once triggered the rush of enthusiasm, and this round of gains temporarily returned to technical buying. The price of gold is only one step away from 1,800 US dollars. Technically, after buying back 1752 U.S. dollars yesterday, we got swift buying, indicating strong support here. From the 4-hour chart of the gold price, the breakthrough of 1763 US dollars and the next resistance of 1777 US dollars.