Gold prices have surged above 30,400 baht per baht of gold in recent days, marking a phenomenon where domestic gold prices have risen over 40%. Meanwhile, global gold prices reached 2,075 USD per ounce, breaking the previous record set 9 years ago (on September 5, 2011) at 1,920 USD per ounce.

Undoubtedly, investing in gold this year has yielded the highest returns for investors, exceeding 37%, outperforming other asset classes. This has led to a continuous sell-off for profit-taking, especially among those who have held onto gold for 9 years, as this represents a significant opportunity for profit realization.

For those considering investing in gold as a Safe-Haven asset, which is known for its stability and security during these times, there may still be hesitation about whether to continue investing in gold due to the ongoing price fluctuations.

The Gold Research Center reported that the gold price confidence index for August 2020 increased compared to July 2020, rising from 62.51 points to 75.54 points, an increase of 13.03 points or 20.84%. The factors contributing to this increase likely stem from global economic uncertainty, demand for safe-haven assets, and the COVID-19 pandemic. Conversely, negative factors affecting gold prices include concerns over profit-taking by central banks and various funds.

Forecasts for gold purchasing demand in August 2020 from a sample of 319 respondents indicated that 42.63% had not purchased gold in August 2020, while 34.48% were uncertain about buying gold, and 22.89% expected to buy gold during this month.

Regarding gold investment in August 2020, major gold traders commented that gold prices are likely to rise in the long term due to the ongoing impact of the COVID-19 pandemic on the global economy and the conflict between the U.S. and China.

However, gold prices remain volatile, with prices fluctuating at high levels and continuously setting new historical highs. Therefore, investors should closely monitor gold price movements and the factors influencing gold prices to plan their investments accordingly.

 

 

Data from the Economic Analysis Division, Office of Policy and Trade Strategy of the Ministry of Commerce indicates that weekly gold price movements (August 10-14, 2020) saw global gold prices decrease, averaging 1,961 USD per ounce, down 2.8% from the previous week as investors sold off safe-haven assets for profit. This was compounded by positive developments regarding COVID-19 vaccine production, as Russia announced it had developed a vaccine, which positively impacted global stock markets and led to a decrease in gold prices amid global economic uncertainty.

Gold prices remain volatile, necessitating close monitoring of monetary and fiscal easing measures in various countries amid a slowing global economy and uncertainties surrounding U.S.-China trade tensions, which are likely to pressure gold prices in the future.

 

MTS Gold Group anticipates that gold prices may consolidate in August before testing the previous high of 2,075 USD, with the potential to rise above that level by the end of the year, possibly reaching 2,200 USD, equating to 31,800 baht per baht of gold.

Investors are advised to gradually accumulate gold when prices dip to 1,920-1,940 USD, targeting about 25% of their gold investment portfolio. If prices continue to decline, they should wait to buy another 25% at 1,900-1,920 USD, and if prices drop further, purchase the remaining 100% of their portfolio at 1,860-1,870 USD. For selling, they should aim to take profits starting from 2,000 USD and above.

For investors focused on speculative trading who already hold gold, they can gradually sell when prices rise from 1,980 to 2,000 USD and wait to buy back when prices drop below this range, with a target of at least 2,100 USD by the end of 2020.

 

Source: Gold Research Center, MTS Gold Group, Economic Analysis Division, Office of Policy and Trade Strategy