London Gold Platform Diving Without Changing Upward Trend

"There's no doubt that most people look at gold Whether the target is gold, gold futures or gold ETF, the open position of call options is more than twice that of put options But once the market goes back, we must be cautious. " On the afternoon of the 27th, a futures investor shared in the circle of friends that London gold was crossing the $1950 mark at that time.

His warning is undoubtedly very timely, London gold hit a record high of $1981.2 on the 28th, and then quickly retreated. Before the press release, London gold fell by 1.54%, and the price fell back to around $1912 / oz.

"After the recent European and American economic stimulus bill and the continuous rise of gold prices, there is no more short-term visible good news support. The market is generally expected to enter a" blank period ", so it is also regarded as a good time point for profit taking." Wang Yanqing, a researcher at the industrial products division of China Securities construction investment futures, said on the 28th.

However, in his view, in the context of no significant change in the current fundamentals, the high dive in gold prices does not mean the end of the current round of precious metal rally. It will be a little more intense in the short term.

Since the last ten days of the Shanghai stock market, for example, the Shenzhen stock market has been in the absolute upward trend of the whole gold market. For example, the gold market has been in a relatively high position since the end of February. For example, the gold market has been in a relatively high position in the last ten days of this year. For example, the gold market has been in a relatively high position in the last ten days of this year.

1921 high resistance to support?

The basis of commodity market to launch a big market needs the resonance of economic cycle and currency cycle, and presents the situation that many major commodities go up collectively.

Today's situation is a little more complicated. Copper prices rebounded first in the first half of the year, while crude oil recovered after a huge drop in the first half of the year. However, the overall commodity market was relatively stable, as can be seen from the tepid CRB index and Wenhua commodity index.

And the current market is more like a structural rise, only precious metal performance is more eye-catching, eye-catching to the rate of rise far beyond market expectations. Some institutions had expected that it would be next year for gold to break its new high of $1921, but the process took only a few days.

Too fast rise, corresponding to the more violent fluctuations.

After February 1981, the absolute amplitude of gold ounce rose to a record high in London. At the time of publication, the amplitude was close to 4% on that day. The last shock of such magnitude still needs to be traced back to the peak of the epidemic in March this year.

But the shock is concussion. In the context of no obvious driving event on the news surface, the industry insiders believe that its price trend will not change.

"There is no need to say much about medium and long-term optimism, at least including the positive monetary and fiscal policies of various countries. The implementation of these policies needs a process and will not change suddenly in the short term." Now, Wang said, there is a big trend.

In his opinion, the historical high of 1921 US dollars in the international gold price will become a support for the operation of gold price in the future after a rapid and effective breakthrough in the near future, "at least there is no potential negative factor at present, and the space for downward movement will be relatively limited."

However, after climbing to the high above $1900, will the subsequent price volatility of gold price further increase?

"These days are an event intensive period, mainly focusing on the progress of the US economic stimulus bill and the interest rate meeting. When these two important events are confirmed, the price fluctuation purely driven by funds will not be very large." Wang said.

In addition, support from inflation expectations also plays a role.

According to a US Treasury bond and inflation expectation data provided by China Securities construction and investment futures, the yield of us five-year treasury bonds has been falling since the beginning of the year, and has remained at a low level since April. During this period, inflation expectations began to rise one after another after reaching the bottom in mid March.

This inflation expectation, including the recent precious metals and copper, which increased significantly in the first half of the year, has actually been reflected in their prices. However, due to the strength of their own fundamentals, there are some differences in the price performance of various commodities.

Gold stocks led by secondary industries

As far as cyclical industries are concerned, the improvement of business capacity is nothing more than quantity and price, and the core is product price. From historical experience, the pulling effect of price on enterprise profitability is much higher than sales volume.

Especially for the investors who have experienced the price rise of rebar in 2017 and pig price rise in 2019, the market is very familiar with the routine of the above-mentioned product price increase driving performance and stock price promotion.

Although the above-mentioned dual attributes of gold and commodities are applicable.

Historical data also show that there is a strong positive correlation between the related enterprises and the international gold price.

In the super bull market from 1999 to 2011, the net profit of CICC gold (600489. SH) increased year by year from 2005 to 1.871 billion yuan in 2011; in 2012, the high point of gold price fell back and fluctuated in the range of $1500 to $1800, and the profit scale of CICC gold fell slightly to 1.557 billion yuan in that year; in 2013, the gold price dropped to 1180.5 U.S. dollars, and the profit of CICC gold dropped sharply to 4.31 billion yuan 100 million yuan.

From the perspective of the trend of gold price operation during the year, except for the periodic adjustment of gold price due to liquidity problems in mid March, all other times showed a unilateral upward trend, with the focus of price operation from $1500 to $1700 at the beginning of the year, and then to $1900 now.

This undoubtedly provides a strong guarantee for the annual performance growth of listed companies involved in gold business.

Taking the above half year as an example, the average price of main contracts of CMX gold futures was 1635.6 US dollars / ounce, up 24.49% compared with the same period in 2019 of 1313.8 US dollars / ounce.

Feedback on the performance of related enterprises, Shandong gold (600547. SH) profit in the first half of the year increased by 80% to 110%, and Yintai gold (000975. SZ) increased by 36.97% to 43.81%.

Looking at the secondary market, the recent overall still continues the adjustment trend since July 14, and the hot plate when the "bull market voice" is high began to disappear, and there is no new plate relay. At this time, gold stocks, which are expected to improve the industry's prosperity and improve corporate profits, stand out.

According to wind data, since the end of July, according to the 104 secondary industries of Shenwan, the gold plate has led all other secondary industries with an increase of 8.94%.

Among them, 12 gold stocks included in the plate, except st Jintai (600385. SH) fell, all other 11 stocks rose, and Chifeng gold (600988. SH) rose nearly 30% in just a few trading days.

However, most of the A-share related listed companies are upstream exploration, mining, metallurgy and other integrated enterprises, and involve certain other associated minerals and other businesses.

In the near future, the gold price of the company will rise by 155.002%, and the higher the gold price will be, the higher the gold price will be.

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