Gold analysis – 21 Jan 2020

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By: Ahura Chalki

IMF report and Red Stock Exchanges!

Gold kept its uptrend mode, as Asian stocks are in red for the second day in a row, after touching their historical high on past Friday. In the time of writing, Nikkei down by 0.87%, while Shanghai and Hang Seng are losing by 1.16% and 2.18%, respectively. “Safe-haven bonds and the yen edged higher as investors were reminded of the economic damage done by the SARS virus in 2003, particularly given the threat of contagion as hundreds of millions travel for the Lunar New Year holidays” (Investing.com). On the other hand, Monday, the International Monetary Fund (IMF), a day before the opening of the World Economic Forum in Davos, published its outlook for 2020 world’s economic growth and for 6th time in a row, they lowered the expectation into 3.3% from previous 3.4%, mostly affected by Indian and other emerging markets. In this report, the outlook for Japan changed better as China, while for the EU and US, the outlook is lowered. Gold in the reaction kept its uptrend which supported by USD index easing as well to 97.30 from its 40-day high in 97.46.

Gold technical analysis:

Gold passed the key level of $1562, for now, technically $1573 and $1580, $1593 and $1611 can be confirmed one after another. On the flip side, 20 D-MA at $1541 is key support which breaching that, can change the trend. Technical indicators, in the H1 chart, also supporting the bulls, RSI moves above 69, EMA crossing strategy is in positive side and Parabolic SAR has its dots, way under the Candles.

Pivot Point: 1560.00

Resistance levels: 1563.88 / 1566.37

Support levels: 1557.31 / 1553.63

Today, the expected trading range is between 1553.63 support and 1566.37 resistance.


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