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By: Ahura Chalki
The rally continues or time to rest?
The gold price has been moving higher in the last days as risk appetite was raising more, caused by COVID-19, as well as weaker than expected economic data from the EU, especially. However, after the $1600 level, it was not just economic data, driving the bulls, it was bulls’ energy as well. Psychological levels, always are important, here what happened, especially after yesterday’s very positive data from the UK, EU, and the US, it was all about correction, while market volume rose and it pushed the price higher, as the confirmation that investors and traders, still do not feel confident with central banks reaction and policy maker’s decisions.
Overnight, by the EU time, few members of FED had speech and yet, none of them had no exact plan for the US market reaction, unless to say we do look at that and it is still soon to talk about its effect on our economy.
For today, after that PoBC eased the loan rates to 4.05% from 4.15%, raised the level of its supports from the local businesses against the virus, which may support the Shanghai stock markets as well. In the rest of the day, UK retail sales and from the US, employment report as well as industrial indexes will be in the spotlight.
Gold technical analysis:
Historically, March 2013 high near $1,617 is the immediate level that can send the market higher, while, as long as it is trading under this level, correction is more likely under $1594.
From the technical overview, in the Daily chart, RSI moves at 69, supporting the bulls, while candles have been crossed the upper line of BB, signaling of overbought situation. Heiken Ashi candles still supporting the bulls, same as OBV trend line which is moving still in the positive side.
Pivot point: 1608.80
Resistance levels: 1618.11 / 1622.20
Support levels: 1604.70 / 1595.40
Today, the expected trading range is between 1595.40 support and 1618.11 resistance levels.
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