Gold analysis 20.01.2020

Gold price futures fluctuated in a narrow range tilted to the upside to witness their bounce back for the third session in five sessions from the lowest since January 3 amid the dollar index rebound to the second session from the top since December 26 according to the inverse relationship between them amid scarcity Economic data this weekend by the US economy due to the holiday celebration of Martin Luther King’s Day in the United States today, Monday, in the wake of the People's Bank of China (the Chinese Central Bank) keeping the interest rate on loans for five years unchanged.

At exactly 04:19 AM GMT, gold price futures for February delivery rose 0.12% to trade at $ 1,559.10 per ounce compared to the opening at $ 1,557.30 per ounce, knowing that the contracts started the session’s trading on a falling price gap after it concluded the week’s trading The past is at $ 1,560.30 an ounce, with the US dollar index falling 0.03% to 97.61 compared to the opening at 97.64.

This was followed up last weekend by economic data that showed the largest economies in Asia and the second largest economy in the world 6.1% during 2019, despite the trade dispute between Beijing and Washington, which recently witnessed its breakthrough with the signing of US President Donald Trump and the Chinese Vice-Premier and President Chinese negotiating team Liu He last Wednesday on the first stage of the trade deal in the White House.

Other than that, investors are looking forward this week to the decision and directions of monetary policy makers at the central banks of the major global economies, starting from the Bank of Japan tomorrow, Tuesday, through the Bank of Canada on Wednesday, and reaching the European Central Bank. Also, attention will be paid during this week to launch the activities of the World Economic Forum in Switzerland. It will be attended by corporate executives and bankers, as well as politicians, and this year they will include US President Trump.

Technical analysis

The price of gold ended last week's trading above 1556.70, which leads the price to start a new bullish wave and stop the bearish correction that started from the areas of 1611.20, supported by the moving average 50, and by looking at the graph, we find that the price has completed forming an inverted head and shoulders pattern shown within the rectangle, This supports the chances of achieving more gains in the upcoming sessions.

Therefore, the bullish bias will be expected for today, and targets start to surpass the 1575.90 level to confirm the trend towards the aforementioned top as a next main station, taking into consideration that breaking 1554.10 and holding below it will return the price to the downside corrective path again.

The expected trading range for today is between 1550.00 support and 1575.00 resistance.

Expected trend for today: bullish.