Gold analysis 08.04.2020

Gold price futures fluctuated in a narrow range tilted to the upside during the Asian session, while the US dollar index resumed its rebound from the lowest since March 17th for the sixth session in nine sessions, according to the inverse relationship between them on the threshold of developments and economic data expected on Wednesday by the economy American and with the evaluation of markets to the developments of the outbreak of the global virus Corona.

At exactly 03:24 AM GMT, gold futures contracts for June delivery rose 0.15% to trade at $ 1,681.20 an ounce compared to the opening at $ 1,678.70 per ounce, knowing that the contracts started the session’s trading on a falling price gap after yesterday's trading was concluded At $ 1,683.70 an ounce, while the US dollar index rose 0.27% to 100.18 compared to the opening at 99.90.

Investors are now looking to the US economy for the Federal Reserve to unveil the minutes of the Federal Open Market Committee meeting that took place on March 15th, that surprising meeting, which was the second in less than two weeks after the previous sudden meeting on the third of the same month, which was approved Federal Reserve monetary policy makers return their short-term benchmark interest rates to zero levels.

The members of the Federal Open Market Committee reduced the interest on federal funds at the time by 100 basis points to between zero levels and 0.25%, which remained since 2008 until the meeting of 27-28 October 2015, after reducing them in the previous emergency meeting by 50 points The basis is between 1.50% and 1.75%, and this comes in the wake of the committee members cutting interest three times by 25 basis points in previous meetings last year.

The Federal Reserve's monetary policy statement stated at the time that the reduction decision is from March 16, and that the Federal Open Market Committee will undertake repurchases of treasury bonds with at least $ 500 billion per month and mortgage-backed securities of at least $ 200 billion per month, at least. These purchases are made at the appropriate speed to support the smooth performance of the stock market, treasury and mortgage agency.

Technical analysis

The price of gold provided noticeable positive trades yesterday, but it returns to the pivotal support test 1644.20, accompanied by the stochastic indicator reaching oversold areas, waiting for the contribution to push the price to rise again and head towards our main target awaited at 1703.25.

Therefore, the bullish trend scenario will remain valid for the coming period, provided stability above 1644.20, noting that breaching this level will press the price to drop towards 1607.70 tentatively before any new positive attempt.

The expected trading range for today is between 1635.00 support and 1680.00 resistance.

Expected trend for today: bullish.