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Gold prices decrease amid declining tensions between the US and Iran

Jan 9 2020, 01:31 PM (+06) | Fortfs.com

On Thursday, the price of gold continues to decline quite actively amid growing optimism regarding tensions between the United States and Iran.

 

Despite rather harsh rhetoric of Donald Trump, he stated that the US would not respond to missile attacks from Tehran and would limit itself to the introduction of new economic sanctions against the Islamic Republic.

 

Iranian authorities have also reduced the aggressiveness of their statements. Foreign Minister Muhammad Javad Zarif tweeted that the country "is not seeking escalation or war."

 

Amid the weakening of geopolitical tensions, the demand for protective assets is falling, which contributes to a decrease in the cost of gold. Today in the economic calendar there is no news that could have a significant impact on the gold dynamics. Therefore, geopolitical news have the main influence.

 

A fairly strong corrective movement is developing on the chart. Locally the price can be supported by the level of 1542.00, but in case of a breakdown of this level, the level of 1530.00 can be the next target for bears.

 

Resistance Levels: 1560.00, 1573.00, 1585.00;

 

Support Levels: 1542.00, 1530.00, 1515.00.

 

The main scenario - a correction towards the level of 1560.00 and further downward movement.

 

An alternative scenario - a breakdown of support at the level of 1542.00 and a decline towards 1530.00.

 

The fundamental outlook is negative. A strong correctional wave is developing on the chart, so within the daily framework, we are considering shorts from the level of 1560.00.

 

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