MENU

Pound Sterling at Critical Juncture against Euro Following Six Days of Unchallenged Gains

Pound Sterling at Critical Juncture against Euro Following Six Days of Unchallenged Gains


The British Pound has arrived at a critical juncture in its recovery against the Euro, with the exchange rate hitting its head on a resistance level that has frustrated advances since June.


Cryptocurrency Live Prices in Pounds, Euros and Dollars

Currency Price (GBP) Price (EUR) Price (USD) Change 24h
Bitcoin BTC 27350.8498 GBP 30762.4 EUR 37148.6742 USD -0.93% Buy Now
Ethereum ETH 906.7131 GBP 1019.81 EUR 1231.5226 USD +1.12% Buy Now
Tether USDT 0.7345 GBP 0.8261 EUR 0.9976 USD +0.3% Buy Now
Ripple XRP 0.2114 GBP 0.2378 EUR 0.2872 USD -0.24% Buy Now
Dash DASH 92.6336 GBP 104.188 EUR 125.8174 USD -4.31% Buy Now
Enjin ENJ 0.1488 GBP 0.1673 EUR 0.2021 USD +4.65% Buy Now
Dai DAI 0.7364 GBP 0.8282 EUR 1.0001 USD +0.36% Buy Now
SunContract SNC 0.0388 GBP 0.0437 EUR 0.0528 USD -4.3% Buy Now
Litecoin LTC 108.6569 GBP 122.21 EUR 147.5808 USD -1.28% Buy Now
Bitcoin Cash BCH 366.4603 GBP 412.17 EUR 497.7365 USD -2.12% Buy Now


Pound Sterling Data and Latest News


1 Day
1 Week
1 Month
This Year
Past Year
5 Years
10 Years

vs G10

vs Next 10

Loading

* 1 Week = past 5 trading days, 1 Month = past 20 trading days, This Year = 2021, Past Year = Past 365 Days

Click Here for More GBP Pairs

Click for EUR | USD | AUD | NZD | CAD | JPY | ZAR | SEK | NOK | CHF


Euro Data and Latest News


1 Day
1 Week
1 Month
This Year
Past Year
5 Years
10 Years

vs G10

vs Next 10

Loading

* 1 Week = past 5 trading days, 1 Month = past 20 trading days, This Year = 2021, Past Year = Past 365 Days

Click Here for More EUR Pairs

Click for EUR | USD | AUD | NZD | CAD | JPY | ZAR | SEK | NOK | CHF


U.S. Dollar Data and Latest News


1 Day
1 Week
1 Month
This Year
Past Year
5 Years
10 Years

vs G10

vs Next 10

Loading

* 1 Week = past 5 trading days, 1 Month = past 20 trading days, This Year = 2021, Past Year = Past 365 Days

Click Here for More USD Pairs

Click for GBP | EUR | AUD | NZD | CAD | JPY | ZAR | SEK | NOK | CHF


Effective Exchange Rates

Gold Price is Back in Shape and Upgraded to "Constructive" at Julius Baer after 2018 Hammering

- Julius Baer upgrades Gold rating to "Constructive".

- Cites positioning flip and an inverse USD correlation.

- Recommends staggered buying over medium-term.

© kasto, Adobe Stock

Gold has been metaphorically hammered into shape, according to analysts at Swiss private bank Julius Baer, who argue in a recent report that the metal is now ripe for a rebound.

"The environment for gold remains challenging," says Carsten Menke, a commodity analyst at Julius Baer. "That said, a lot of bad news is priced in and even in the short term, there should be more upside than downside. We upgraded our view to Constructive and bought a first position."

Further downside for gold is limited by positioning in the futures market which has reached overly bearish levels and is, therefore, 'due' a rebound.

"Speculative traders are net short for the first time since the turn of the century, suggesting that prices are bombed out on current levels," says Menke. "Hence, it is very unlikely in our view that gold falls back towards the lows reached during the past year’s bear market, i.e. that it drops another 10% to 15%."

Above: Julius Baer gold price chart annotated around major price developments.

Demand should pick up in the medium-to-long term as increasing global growth concerns and rising inflation see gold reinstated in its traditional role as an inflation hedge.

"Sustainable upside to prices should materialise once growth and inflation concerns creep into financial markets, reviving the demand for gold as a safe haven," says the Julius Baer analyst.

Gold should also rally once the Dollar rolls over at the end of the year, since of all the factors driving its price at the moment, the value of the US Dollar is probably the single most important.

"Gold and the US dollar trade in a very close inverse relationship," Menke writes, in his report.

This makes perfect sense given gold is priced in US Dollars. When the Dollar rises, the yellow metal becomes more expensive for many would-be owners to buy. .

The reason behind the Dollar's rise, however, is also a key factor: interest rates. As US interest rates have risen, US investors have dumped gold for other more lucrative interest bearing assets or equities, some of which have been rising strongly in a bull market.

Above: Julius Baer chart showing US gold holdings relative to Chinese, European.

Another factor behind falling demand has been the investors' perceptions of President Donald Trump's "trade wars". This has not been viewed as negatively by US investors as it has been abroad, so safe-haven demand has been absent. 

Menke says the future is bright for Gold after upgrading his rating of the metal to 'constructive'. He recommends buying into it gradually over the medium-term.

"We see structures that allow accumulating gold on lower-than prevailing prices, i.e. to average into the market, as a good option to build positions gradually," he writes.

Gold future were quoted 0.42% lower at $1,190 per ounce during noon trading Thursday and are down by 8.6% for 2018.

 

Advertisement
Get up to 5% more foreign exchange by using a specialist provider to get closer to the real market rate and avoid the gaping spreads charged by your bank when providing currency. Learn more here

Advertisement Data Slot Mobile

350 250 banner