Gold, same as other protective assets, starts the trading week with an upward gap due to the reports of a new strain of coronavirus rapid spread. According to the latest data, the death toll increased to 80 people, and the number of infected exceeds 2700 people. The mayor of Wuhan stated that in the near future another 1,000 cases of infection could be confirmed. Six new infections have been confirmed in Hong Kong. At the same time, Hong Kong authorities banned the temporary entry of residents visiting Hubei Province to avoid further spread of the virus.
Donald Trump introduced increased duties on imports of steel and aluminum, making exceptions for some countries. This news was perceived rather negatively by the market.
The market is trying to avoid risks. Major indices are traded within the red zone. Gold is currently trading at a 0.4% increase.
Among the economic news today, it is worth paying attention to the publication of the new housing sales data.
Regarding the chart, the price tested resistance at the level of 1585.00. It was not possible to gain a foothold above this mark, therefore, in the future we can expect the development of a moderate pullback movement in the direction of the level of 1567.85.
Resistance Levels: 1585.00, 1600.00, 1611.00;
Support Levels: 1571.00, 1550.00, 1542.00.
The main scenario - a decline towards the level of 1570.00 and the resumption of upward movement.
An alternative scenario - a breakdown of resistance at the level of 1585.00 and an increase in the direction of 1600.00.
The fundamental outlook is moderately positive. As to the chart, we consider longs from the level of 1571.00.