The ambiguous data of macroeconomic statistics from China and the continuing uncertainty around the prospects for the development of the global economy contribute to the gold price.
Today, China reported a growth of industrial production in April by 3.9%, against the forecast of + 1.5%. At the same time, the volume of investments in fixed assets decreased by 10.3% (forecast -10.0%), while retail sales fell by 7.5% (forecast -7.0%). Despite the local recovery, the overall economic situation in China remains difficult. The low level of domestic and foreign demand will limit the scale and recovery speed of the Chinese economy.
Statistics from key economic regions of the world suggest that restoring the global economy will require much more time and effort than previously expected. At the same time, the risk of the start of the second wave of the pandemic remains, which will further exacerbate the economic situation in the world. In this regard, investors today will closely monitor the publication of preliminary GDP data for the EU and Germany, as well as the April report on US retail sales. For all indicators, a serious decline is expected.
Against the background of general uncertainty and increased risks, investors again prefer traditional protective assets.
Regarding the chart, the price tested the level of 1740.00. Further development will depend on whether the bulls manage to overcome this resistance or not. In case of a breakdown, we are expecting an update of the local maximum at the level of 1747.00.
Resistance Levels: 1740.00, 1750.00, 1760.00;
Support Levels: 1729.00, 1713.00, 1695.00.
The main scenario - a breakdown of intraday support at 1729.00 and a decline to 1713.00.
An alternative scenario - a breakdown of resistance at 1740.00 and an increase to 1750.00.