Gold is holding ground above the $1800 mark due to growing concerns about the spread of coronavirus and tensions between the United States and China.
According to Johns Hopkins University, the number of cases of COVID-19 as of July 14 exceeded 13 million. The number of cases in the USA continues to grow. California Governor Gavin Newsom suspended restaurants, movie theaters, zoos, card rooms and bars throughout the state on Monday, significantly lowering investors' expectations for a faster economic recovery.
Growing tensions between the United States and China are also having a positive effect on gold. On Monday, Mike Pompeo stated that China’s claims to the South China Sea are illegal. In response, the Chinese Embassy in Washington accused the White House of fomenting conflict in the South China Sea.
Economic and geopolitical risks continue to increase, so the demand for gold in the medium and long term will remain stable. Gold has good opportunities to consolidate above the level of $1800 and continue to move up.
Today in the economic calendar it is worth paying attention to the publication of the US inflation report for June.
Regarding the chart, trading takes place in a flat with borders at the levels of 1793.00 - 1820.00. As part of the flat, we are expecting further upward movement to the level of 1820.00.
Resistance Levels: 1820.00, 1830.00, 1850.00;
Support Levels: 1793.00, 1774.00, 1760.00.
The main scenario - growth by 1820.00.
An alternative scenario - a consolidation below 1793.00 and a drop to 1774.00.
The current fundamental outlook is moderately positive. We would consider longs near the level of 1793.00.