Gold analysis 24.07.2020

Gold price futures fluctuated in a narrow range tilted to the upside during the Asian session to witness stability near the top since the beginning of September 2011, when I tested the highest ever. And with the US dollar index falling to its lowest level since September 27, 2018, according to the inverse relationship between them before the economic developments and data expected on Friday by the American economy, the largest economy in the world, and in light of the growing concern about the escalation of tensions between the United States and China, the largest consumer of metals globally.

At exactly 04:10 am GMT, gold futures contracts for next August delivery rose 0.22% to trade at $ 1,889.10 per ounce compared to the opening at $ 1,884.90 per ounce, knowing that the contracts started the trading session on a falling price gap after it concluded trades Yesterday at $ 1,890.00 an ounce, with the US dollar index down 0.14% to 94.64 compared to the opening at 94.77.

Investors are currently awaiting the disclosure of the initial reading of the Markit Industrial and Service Purchasing Managers Index for the United States of America, which may reflect the expansion of the industrial sector in the largest industrial country in the world to a value of 52.0 compared to a contraction of 49.8 in the previous reading last June, Likewise, we may witness the services sector expanding to 51.0 compared to 47.9 in June.

This comes before we witnessed by the US economy the disclosure of housing market data with the release of the New Home Sales Index, which may indicate an increase of 4.0% to about 700 thousand homes compared to a rise of 16.6% at 676 thousand homes last May.

Yesterday, we followed up on US Secretary of State Mike Pompeo's criticism of China in a speech, stating that Washington will no longer tolerate Beijing's attempts to usurp the world order.

This was followed, China’s call for the United States to close the US consulate in Chengdu, in response to the recent US decision to close the Chinese consulate in Hyosin, and the statement issued by the Chinese Foreign Ministry mentioned that “the current situation between Washington and Beijing is not something that China wants to see, and the United States is responsible Completely on him, "and Beijing again urged Washington to rescind the wrong decision and create conditions for a return to bilateral relations

Follow us yesterday, US Treasury Secretary Stephen Mnuchin reported that his country will work to stabilize the US dollar and that the White House is working to provide about $ 2 trillion to reduce the negative effects of the Coronavirus, and indicated that providing jobs within the economy is among the priorities in the upcoming draft facing the coronavirus And adding that the US administration is currently looking at unemployment benefits, which represent about 70% of wages.

Technical analysis

Gold found a strong resistance at the $ 1900.00 barrier, to show sideways trading near this level, waiting for a positive momentum enough to push the price to resume the bullish bias and exceeding the mentioned level to head towards our next main target awaited at 1920.80.

Consequently, we continue to favor the bullish trend for the upcoming period supported by the EMA50, noting that breaking 1860.00 will put the price under intraday negative pressure targeting to test the areas of 1835.00 and it may extend to 1810.00 before any new attempt to rise.

The expected trading range for today is between 1860.00 support and 1920.00 resistance.

Expected trend for today: bullish.