Gold analysis 03.03.2020

Gold price futures fluctuated in a narrow range tilted toward retreat during the Asian session, promising to resume their weekly losses that were suspended last week for the first time in three weeks amid the US dollar index rebounding to the fourth session in six sessions from the lowest since March 17, according to the reverse relationship. Between them on the threshold of economic developments and data expected on Friday by the US economy and in the shadow of concern about the repercussions of the outbreak of the Corona virus globally.

At exactly 04:43 AM GMT, gold price futures for June delivery decreased 0.19% to trade at $ 1,632.20 per ounce compared to the opening at $ 1,635.30 per ounce, knowing that the contracts started the session’s trading on a falling price gap after it concluded yesterday's trading At $ 1,637.70 an ounce, with the US dollar index rising 0.04% to 100.26 compared to the opening at 100.21.

Investors are currently awaiting by the US economy the disclosure of labor market data with the release of the employment change index for sectors other than agriculture, which may reflect the loss of 100 thousand jobs compared to 273 thousand added jobs in February, while the reading of the average hourly income index may indicate a slowdown Growth to 0.2% versus 0.3%. This is with the unemployment rate reading showing an increase from the lowest in five decades at 3.5% to 3.8%.

This comes before we witness the issuance of the final reading of the Service Supply Institute index by Markit for the United States, which may reflect the widening of the contraction to 38.7 compared to 39.1 in the initial reading for the past month and against a contraction at 49.4 in February, and before revealing the reading of the Institute of Supply Index Service, which may show a contraction of 43.5 compared to 57.3 in February.

We would like to point out, because the reading issuance at 50 or higher reflects a widening, while its issuance is less than 50 indicating a contraction, and that the service provision in America lies in the fact that the service sector represents more than two-thirds of the gross domestic product, otherwise, Wednesday, US President Donald Trump warned of The coming period is "painful" for his country, after he recently announced the extension of the quarantine in America until the end of this month to limit the spread of the Corona virus.

In another context, we followed last Monday the announcement of the Russian Central Bank, the largest buyer of gold globally, about its intention to stop its purchase of gold at the beginning of April, and he did not provide reasons for that suspension, with his statement that his future decisions will depend on the state of the financial markets, and we would like to point out that the outbreak Corona halted hundreds of flights, preventing gold from being transported and disrupting global supply chains.

Technical analysis

Gold price confirmed the breach of the level of 1599.10 after the daily candle closed above it, to support the expectations of continuing the bullish trend, waiting for the test of the 1633.60 level as a next positive station, noting that breaching this level will extend the upside wave to reach the 1689.30 areas in the near term.

Consequently, we will continue to favor the bullish trend during the upcoming sessions supported by the EMA50, noting that the continuation of the bullish wave requires stability above 1571.20.

The expected trading range for today is between 1590.00 support and 1650.00 resistance.

Expected trend for today: bullish.