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Sep 9 2020, 01:58 PM (BDT) | Fortfs.com

Gold is trading slightly lower on Wednesday in response to a strengthening of the USD. A limitation for bears is the situation on the stock markets. Asian and European indices are falling after a strong drop in tech stocks on Wall Street.

 

One of the largest pharmaceutical companies AstraZeneca plc has suspended the final trials of the COVID-19 vaccine due to an unknown illness of one of the participants in the trials. The company developed a vaccine in conjunction with the University of Oxford. Previously, AstraZeneca plc was considered one of the leaders in the race to create a vaccine against COVID-19. The news of the suspension of vaccine trials coincided with reports of an increase in the number of COVID-19 infections in European countries, India, some Asian countries and certain US states.

 

According to Johns Hopkins University, the number of cases of infection in the world continues to rise, exceeding the level of 27.5 million as of September 9.

 

Investors also focus on news related to trade negotiations between London and Brussels. Against the background of the latest harsh statements from representatives of the UK, investors are betting on the implementation of a tough Brexit scenario, in which the country will leave the EU without a trade agreement.

 

Economic and geopolitical risks are growing, therefore, despite the strengthening of the dollar, the demand for gold will remain steadily high. Precious metal retains good prospects for renewed upward movement.

 

On the chart, the price is holding in the range of 1914.00-1947.00. Yesterday bears were unable to push through the lower border of the range. A false breakout is a good signal for a recovery in quotes to at least 1947.00.

 

· Resistance levels: 1947.00, 1967.00, 1993.00.

 

· Support levels: 1914.00, 1900.00, 1875.00.

 

The main scenario - a consolidation in the range of 1914.00-1947.00.

 

An alternative scenario - a breakdown of resistance at 1947.00 and growth to 1967.00.

 

The current fundamental outlook is neutral. We consider longs near the level of 1914.00.

 

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