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Gold prices surpassed six-year maximums

Jan 6 2020, 01:23 PM (+06) | Fortfs.com

Gold prices on Monday start with a strong upward gap (more than 1.5%) and are now at maximum levels since March 2013.

 

The demand for gold rose sharply after the aggravation of relations between the United States and Iran. Investors anticipate a direct military conflict between the two countries. Iranian authorities have promised to avenge the death of General Kassem Suleimani, who died in a U.S. strike. Tehran also refused to comply with the terms of the nuclear deal to the full sanctions by the United States.

 

In turn, Donald Trump threatened Iran with new attacks in case of attacks on American citizens or US facilities. Trump also threatened sanctions against Baghdad, which denounced the actions of the United States. Recently, the U.S. parliament supported a resolution that calls on the government to cease any foreign military presence in Iraq.

 

Due to the lack of important news in the economic calendar, geopolitical news will have the main impact on the market. In case of increasing geopolitical risks, gold may continue to move up.

 

Regarding the chart, we can note the level of 1579.00, which locally keeps the price from further growth. But, upward pressure on this level is increasing, so today the priority scenario is growth towards 1590.00.

 

Resistance Levels: 1579.00, 1588.00, 1600.00;

 

Support Levels: 1568.00, 1557.00, 1546.00.

 

The main scenario - a breakdown of the mark of 1579.00 and an increase towards 1590.00.

 

An alternative scenario - a correctional decline towards 1568.00.

 

The fundamental outlook is positive. A strong bullish trend continues to develop on the chart, so intraday trading should be preferred. Entry points should be sought around the mark of 1568.00.

 

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