Gold analysis 08.05.2020

Gold prices fluctuated in a narrow range tilted towards the decline during the Asian session while still in the process of weekly gains after rising yesterday by more than two percent, indicating its best daily performance in two weeks, condoning the decline in the US dollar index for the second consecutive session from its highest since April 24 / April, when he tested the highest for him since the sixth of the same month, according to the inverse relationship between them.

This comes on the cusp of developments and economic data expected today by the American economy, which includes the disclosure of labor market data, which may reflect the high unemployment rates in the United States to its highest in about seven decades with the loss of more than twenty 22 million jobs in the largest economy in The world is caused by an outbreak of the Coronavirus and in the shadow of market pricing for a general trend to ease restrictions and the end of the global closure.

At exactly 04:43 AM GMT, gold price futures for June delivery decreased 0.11% to trade at $ 1,725.30 per ounce compared to the opening at $ 1,727.20 per ounce, knowing that the contracts started the trading session on an upward price gap after it concluded yesterday's trading At $ 1,725.80 per ounce, while the US dollar index fell 0.11% to 99.73 compared to the opening at 99.84.

Investors are currently waiting for the American economy to disclose labor market data with the release of the employment change index for sectors other than agriculture, which may reflect the loss of 22 million jobs compared to the loss of 701 thousand jobs last March, while the average hourly income reading may indicate Growth accelerated to 0.5% versus 0.4%. This was with the unemployment rate reading showing a rise to 16.0% to 4.4% in March.

This comes, before we witness the final reading of the wholesale stocks index, which may reflect the stability of the decline at 1.0% during February. Otherwise, we followed yesterday. US President Donald Trump expressed that the outbreak of the Coronavirus  is worse than the attacks of September 11. On the World Trade Center, adding that the coronavirus could have been stopped from its source, explaining that China was able to control the disease.

We would like to point out that the US Secretary of State Mike Pompeo yesterday accused China of delaying the response to confronting and containing the Coronavirus , explaining that it had not taken its measures quickly enough to avoid the spread of the virus, and it is mentioned that these accusations by the US official for China are the second in less than a week, Where he noted at the weekend that the virus was created from a laboratory in the Chinese city of Wuhan, while the spread was an unintended event.

Technical analysis

The bullish gold price rally stopped near the pivotal resistance that is now dropping to 1725.00, and is affected by the stochastic negativity showing some temporary bearish tendency, waiting for a positive momentum to be paid to push the price above the mentioned level and opening the way towards achieving our expected targets that start at 1747.43 then 1785.00.

In general, we will continue to favor the bullish trend for the next period unless 1678.45 level is broken and stability remains with a daily closing below it.

The expected trading range for today is between 1690.00 support and 1745.00 resistance.

Expected trend for today: bullish.