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Gold analysis – 14 May 2020
By: Ahura Chalki
No negative rate, at least for now, but QE plan can be spread, it was the main structure of FED policy for now, as Mr. Powell’s mentioned in his speech in Peterson institute. Also “warning of a “significantly worse” U.S. recession than any downturn since World War Two as the COVID-19 virus continues to wreak economic havoc globally” (investing.com).
As we were expecting, the stock markets fall deeper after his speech, and yellow metal tokes advantage of that. In early Asian season gold kept its way towards $1720, with a correction lower later after that, the market will be waiting for the final signal for its move. Investors are now looking to the US initial jobless claims number, while the forecast is for 2.5M more jobless for last week, positive data can slow down the Gold bulls, while negative data, will make $1800 more likely to catch.
Gold technical overview – H1 Chart
Technical indicators from the side movement figure of past days changed to positive positioning. RSI at 55 sloping higher, OBV trend line changed into the positive side and candles above the middle line of BB. $1704, the lower band of BB and 200 HMA is the key support, while the upper line, sitting at $1720 is the immediate resistance.
Pivot point: 1712.26
Support levels: 1725.50 / 1731.20
Resistance level: 1706.55 / 1693.32
Today, the expected trading range is between 1706.55 support and 1731.20 resistance.
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