Gold analysis 31.03.2020

Gold price futures fluctuated in a narrow range tilted backwards to witness their bounce for the fourth session in five sessions from the highest since March 9, when it tested the highest for it since December 18, 2012, while still in the process of resuming its monthly gains that stopped Last month, for the first time in three months, after the dollar index rebounded for the third session from the lowest since March 17, according to the inverse relationship between them.

This follows economic developments and data that were announced by the Chinese economy, the world's largest producer of gold and the largest consumer of minerals in the world, and on the cusp of developments and economic data expected today by the American economy, and following the signing of US President Donald Trump recently on the stimulus package estimated at $ 2 trillion to support The largest economy in the world and American families and companies face the consequences of the Corona virus.

At exactly 03:35 am GMT, gold futures contracts for June delivery fell 0.42% to trade at $ 1,636.60 per ounce compared to the opening at $ 1,643.40 per ounce, knowing that the contracts started the trading session on an upward price gap after it concluded yesterday's trading At $ 1,643.20 an ounce, with the US dollar index rising 0.05% to 99.30 compared to the opening at 99.26.

We have just followed up the China Federation of Logistics and Procurement (CFLP) disclosed data for the industrial and service sector for the month of March, which showed expansion in the wake of the worst performance in its history at all last month due to the repercussions of the quarantine and closures recently adopted by China in efforts to reduce The spread of the Corona virus, which started in the Chinese city of Wuhan.

The industrial sector in China, the second largest economy in the world and the second largest industrialized country in the world, expanded to a value of 52.0 compared to a contraction of 35.7 in February, exceeding expectations that indicated a contraction to 44.9, and the Chinese service sector expanded this month to its value 52.3 versus contraction at 29.6 in February, also better than expectations for contraction to 42.1.

On the other hand, investors are currently waiting for the US economy to disclose housing market data with the release of the house price index, which may show a slowdown in growth to 0.40% compared to 0.43% last December, and the annual reading of the S&P House Price Index showed an acceleration Growth to 3.29% versus 2.85% in the previous annual reading for December.

This comes before we witnessed by the largest industrialized country in the world, the disclosure of industrial sector data with the release of the Chicago PMI reading, which may reflect the widening of the contraction to 44.1 compared to 49.0 in February, up to the disclosure of the consumer confidence index reading that may appear Breadth shrank to 115.1 from 130.7 in the previous reading in February.

Technical analysis

The price of gold fluctuates in a lateral path recently and is still below 1633.60, noting that the stochastic has cleared its negative momentum to reach the oversold areas in the sale, waiting for the price to be stimulated to resume positive trades and penetrate the aforementioned level to confirm opening the way to achieving our next target that reaches 1689.30.

Therefore, we will maintain our bullish expectations for the upcoming period supported by the EMA50 that carries the price from below, noting that the expected continuation of the rise requires stability above 1599.10.

The expected trading range for today is between 1600.00 support and 1650.00 resistance

Expected trend for today: bullish