Developing optimization and prediction model for gold price forecasting in Malaysia

In this paper, we demonstrated the effectiveness of modeling predictions of gold prices in Malaysia using the Euler numerical method. Our predictive model utilized the Euler numerical scheme to uncover the intelligent trend in the gold price distribution using the World Gold Council data for 10 consecutive years. Our forecasting model was built on Evan’s price adjustment model, which identified demand and supply as the major factors responsible for price changes in commodities. Demand and supply functions are major determinant factors that influence the price of commodities at any particular time. Demand and supply can simultaneously compel the price of commodities to adjust to the oscillation caused by them. Using data from the World Gold Council between 2010 and 2020 for Malaysia, we were able to formulate a predictive model capable of predicting the price of gold. The results obtained using our model as a price predictor in computing future gold prices in Malaysia proved effective and efficient. Such a model will assist the government, banks, households, and other investors in optimizing profit, through better planning and wealth recreation within the economy.