Gold analysis 27.05.2020

Gold prices fluctuated in a narrow range tilted towards the decline during the Asian session to witness its bounce for the fifth session in eight sessions from its highest since April 14, when it tested the highest for it since the fifth of October 2012 amid the high dollar index indicating its bounce for the second session The lowest since May 4, when the lowest has been tested since March 30 according to the inverse relationship between them.

This comes on the cusp of developments and economic data expected today by the US economy, the largest economy in the world, and amid market pricing to reopen many global economies and hopes to reach a vaccine for the Coronavirus later this year in addition to the recent tensions between Washington and Beijing, especially about the application of China. The new National Security Law, which limits the rights and freedoms of Hong Kong citizens.

At exactly 04:09 AM GMT, gold price futures for next August delivery fell 0.31% to trade at $ 1,718.70 per ounce compared to the opening at $ 1,724.10 per ounce, knowing that the contracts started the trading session on a falling price gap after it concluded trading Yesterday at $ 1,728.20 an ounce, with the US dollar index rising 0.12% to 99.13 compared to the opening at 99.01.

Investors are currently waiting for the US economy, the world's largest industrialized country, to disclose data on the industrial sector, with the release of the Richmond Industrial Index reading, which may reflect a contraction in the contraction of 40 to 53 compared to last April, and that comes before we witness the unveiling of the book Beige What is important is that it is issued two weeks before the FOMC meeting.

Other than that, we followed yesterday, US President Donald Trump said he would announce his administration’s response to China’s actions by the end of the week, touched upon some report that Washington was considering imposing sanctions on Chinese officials and that the US Treasury could impose transaction controls and freeze the assets of officials and companies Chinese to apply Beijing new national security law, which limits the rights and freedoms of Hong Kong citizens.

Technical analysis

Gold confirmed the break of the level of 1725.90 after the daily candle closed below it, heading towards visiting the 23.6% Fibonacci retracement level for the entire rise that was measured from 1455.10 to 1764.04, which is located at 1691.10.

The intraday descending channel organizes the suggested descending wave, noting that breaking the target level will extend the descending corrective wave to target the level of 1646.00 as the next station, while the expected decline will remain in place unless the price rushes to breach 1725.90 then 1735.00 levels and stability above it.

The expected trading range for today is between 1690.00 support and 1725.00 resistance.

Expected trend for today: bearish.