Gold analysis 23.04.2020

Gold price futures fluctuated in a narrow range that tilted toward a decline during the Asian session, to witness its bounce back for the fifth session in eight sessions from its highest since October 5, 2012, disregarding the US dollar index rebound from its highest since the seventh of this month according to the inverse relationship between them On the threshold of the expected economic developments and data today, Thursday, by the US economy, the largest economy in the world, and in light of the market pricing of the negative repercussions of the spread of the Coronavirus globally and the stimulus that aims to contain these repercussions.

At exactly 04:20 AM GMT, gold price futures for June delivery decreased 0.11% to trade at $ 1,734.60 per ounce compared to the opening at $ 1,736.50 per ounce, knowing that the contracts started the trading session on a falling price gap after it concluded yesterday's trading At $ 1,738.30 an ounce, while the US dollar index fell 0.02% to 100.43 compared to the opening at 100.45

Investors are currently awaiting by the US economy the issuance of the index of subsidy requests for the last week on April 18, which may reflect a decline by 895 thousand applications to 4,350 thousand applications compared to 5,245 thousand requests in the previous weekly reading, while the reading of continuous subsidy applications for the week may appear Last month on the 11th of this month, an increase of 5,295 thousand requests to 17,271 thousand requests compared to 11,976 thousand requests.

This comes before we witness the revelation of the initial reading of the Markit Industrial and Service Purchasing Managers Index for the United States, which may reflect the widening contraction of the industrial sector in the largest industrial country in the world to a value of 35.1 compared to 48.5 in the previous reading last March, as we may witness The service sector contracted to 30.5 compared to 39.8 in March.

To reveal the housing market data from the release of the New Home Sales reading, which may explain a 16.0% decline to 643 thousand homes compared to a 4.4% decline at 765 thousand homes last February. In another context, we followed yesterday, and US Treasury Secretary Stephen Mnuchin expressed The fact that his country needs to boost fiscal spending and that 60 million workers are likely to find assistance from the business loan program.

The US Treasury Secretary mentioned Manuchin that the cost of lending to workers who will get loans will be low, given that the interest on federal funds is currently at zero levels, and that came with his discussion that the United States will provide $ 2.6 trillion directly to support the largest economy in the world. Facing the repercussions of the coronavirus outbreak, it reported that the Federal Reserve was providing $ 4 trillion in liquidity.

Other than that, we followed last Tuesday, the Senate announced the agreement of the polar American policy the ruling Republican Party, which has the majority of the Senate and the Democratic Party with the majority of the House of Representatives, on a program to support small companies and medical centers worth $ 484 to address the consequences of the outbreak of the Coronavirus, including $ 320 Billion for small businesses The bill is expected to pass in the House of Representatives later today.

It is reported that US President Trump recently announced his administration's plan to gradually restart and operate the American economy, indicating that the global medical crisis may subside later, while its economic consequences remain, and according to the latest figures issued by the World Health Organization, the number of cases infected with the Coronavirus has increased to Close to 2.48 million and 169,151 people were killed in 213 countries.

In another context, the markets are still assessing the catastrophe of the oil markets and the sharp fluctuations in the global energy markets in addition to other indications that global companies and banks are making it difficult to provide expectations in the shadows of the global closure due to the outbreak of the Coronavirus, and we would like to point out that the collapse of the oil markets earlier this week She points out that the blow to the global economy will be much worse than what investors expected.

Technical analysis

Gold achieved good gains yesterday and settled above the $ 1700.00 barrier, reinforcing expectations for the continuation of the main bullish trend, whose first target is at 1747.43, noting that breaching this level will extend the upside wave to reach the areas of 1780.00.

SMA 50 continues to support the suggested bullish wave, which will remain intact, provided stability above 1678.45, as breaking this level will press the price to make more bearish correction whose next target is located at 1635.80 before any new positive attempt.

The expected trading range for today is between 1695.00 support and 1740.00 resistance.

Expected trend for today: bullish.