Gold Technical Analysis: Bullish Stability Awaiting Developments
The gold price performance is characterized by upward stability in recent trading sessions, its gains at the beginning of this week’s trading reached $1577 an ounce before settling around $1568 at the time of writing, while awaiting the content of the Federal Reserve Governor Jerome Powell’s testimony later in the day, which usually affects the US dollar and, accordingly, the price of gold. What supported gold gains is the global fears of the Corona epidemic outbreak and its threat to global economic growth, which supports investor strong demand for safe havens and gold is one of the most important ones. Corona has killed over 1,000 people in China, infected more than 40,000 and spread in more than 20 countries around the world.
US President Donald Trump unveiled a controversial $4.8 trillion budget plan. Trump's proposal will cut $465 billion from medical care providers such as hospitals, which has angered Democrats. Trump's budget will need congressional approval. It relies on rosy economic forecasts of 2.8% for economic growth this year and 3% in the long term - plus fanciful claims of future cuts to domestic programs - to show that the deficit curve can be bent in the right direction. Details of that budget may influence voters ’turnout in Trump's presidential election in November 2020.
Besides the Coronavirus and the internal political conflict in the United States, the price of gold gets support from fears of a mysterious future for trade relations between the European Union and Britain amid differences in their first rounds of post-Brexit negotiations.
According to the technical analysis of gold: The general trend of gold is still bullish and as shown on the daily chart below, bulls are waiting for the opportunity to push the price towards the $1611 resistance again, and on the downside, the closest levels of support for gold are currently 1562, 1557 and 1545, respectively. I still prefer to buy the yellow metal from every bearish level. There is an omission from the market for prices reaching overbought areas. But global market tensions support the opportunity to gain more than have a bearish correction.
As for the economic calendar data today: The price of gold will react to the release of the important British economic data and the content of the testimony of US Federal Reserve Governor Jerome Powell.
- Currency Pairs