ad
Forex Brokers Award 2020
Vote your favourite broker
Trade 100 Bonus - the best offer on Forex market

Gold is on a rise for 5 days in a row

Jul 24 2020, 01:29 PM (+06) | Fortfs.com

Gold is on a slight decline on Friday after a continuous 5-day growth. At the same time, gold retains the opportunity to resume its upward movement due to continuing economic uncertainty and increased geopolitical risks. Trading takes place near the all-time maximum level since 2011.

 

The local decline in quotations is primarily due to the influence of technical factors. Some investors have fixed some of their long positions after the next renewal of the multi-year maximum.

 

Fundamental background remains positive. Investors are watching the situation in the US with dismay. The number of people infected with COVID-19 continues to grow steadily. Many states are tightening quarantine measures. For the first time in the past 17 weeks, the US saw an increase in the number of applications for unemployment benefits. The growth of the indicator is primarily associated with the deterioration of the epidemiological situation in the country. Obviously, under these conditions, the White House and the Federal Reserve will increase stimulus measures to minimize the consequences for the economy. The USD will remain under pressure, raising attractive gold for purchases.

 

New forms of confrontation between the United States and China are increasing the general uncertainty in the market. The parties moved from economic struggle to diplomatic war. In response to the closure of the consulate in Houston, the Chinese Foreign Ministry today announced the closure of the American consulate in Chengdu. Experts believe that the conflict will only grow as the US presidential election approaches. The day before, Donald Trump once again laid the blame for the COVID-19 pandemic on China, noting that after that the trade agreement became less significant for him.

 

Today the focus of the market will be on preliminary PMI data on the manufacturing sector and services in Europe and the US.

 

Medium-term gold retains good potential for further growth, but today is Friday and there is a risk that many speculative investors may fix long positions before the weekend

 

Pay close attention to the level of 1890.00 on the chart. Fixation above is a signal for a new bullish wave to develop towards 1900.00 and, possibly, to the all-time high at 1921.00. A false breakdown at 1890.00 and a rebound downward is a signal for the development of a corrective movement to 1873.00.

 

Resistance levels: 1890.00, 1900.00, 1921.00;

 

Support levels: 1873.00, 1863.00, 1844.00.

 

The main scenario - a decline to 1873.00.

 

Alternative scenario - a consolidation above 1890.00 and growth in the direction of 1900.00 and above.

 

The current fundamental outlook is positive. We would consider shorts with very moderate risks from the level of 1890.00.

 

Fortfs.com

Fort Financial Services - a licensed international Forex broker. A wide range of trading opportunities: more than 500 tradable contracts, Fort, Flex, Pro and Newbie accounts, direct access to world exchanges, diverse trading platforms: MetaTrader4, CQG Trader, Ninja Trader, Binary Options, partnership programs, free analytics and much more.