Gold analysis 14.08.2020

Futures contracts for gold prices fluctuated in a narrow range tending to decline during the Asian session, to witness its rebound to the fourth session in six sessions from its highest ever, and to prepare for the first weekly losses in ten weeks amid the rise of the US dollar index according to the inverse relationship between them following developments and economic data that followed them on The Chinese economy is the largest consumer of minerals in the world and on the cusp of developments and economic data expected on Friday by the US economy, the largest economy in the world.

At 04:39 AM GMT, gold futures contracts for December delivery fell 0.22% to trade at $ 1,959.50 an ounce compared to the opening at $ 1,963.80 an ounce, knowing that the contracts started trading on a downward price gap after it was concluded Yesterday's trading was at $ 1,970.40 per ounce, with the US dollar index rising 0.01% to 93.23 compared to the opening at 93.22.

We have followed up on the disclosure of the National Bureau of Statistics of China on the annual reading of the Industrial Production Index, which showed stable growth at 4.8% in July, in contrast to expectations that indicated an acceleration of growth to 5.1%. While the annual retail sales index showed a contraction of the decline to 1.1% against 1.8% in June, worse than expectations for a 0.1% rise, and the unemployment rate reading showed stability at 5.7%, in line with expectations.

On the other hand, investors are currently awaiting the US economy to unveil a reading of retail sales, which represents about half of consumer spending, which represents more than two-thirds of the United States' GDP, and which may reflect slowing growth to 2.0% compared to 7.5% in June, as may The core reading of the same index shows growth slowed to 1.3%, from 7.3% in June.

This comes in conjunction with the release of the preliminary reading of the single labor cost index, which reflects an acceleration of growth to 6.5% compared to 5.1% in the first quarter, while the preliminary reading of the productivity of non-agricultural sectors may show a 1.5% rise against a 0.9% decline, and before we witness the disclosure of industrial sector data. For the largest industrialized country in the world, with the release of the Industrial Production Index, which may reflect a slowdown in growth to 3.1%, compared to 5.4% in June.

This coincides with the release of the energy utilization rate index reading, which may indicate an acceleration of growth to 70.3% compared to 68.6% in June, leading to the disclosure of the preliminary reading of the University of Michigan Consumer Confidence Index, which may show a contraction of the expansion to a value of 72.0 compared to 72.5 in July. In July, in conjunction with the final reading of the wholesale stocks index showed the decline narrowed to 1.1% from 2.3% in May.

Other than that, the markets are looking forward to the upcoming trade talks between Washington and Beijing tomorrow, Saturday, via satellites, which aim to review the officials of the two largest economies and two industrialized countries in the world, for the implementation of the first phase of their trade agreement, especially after the significant escalation of tensions between Washington and Beijing recently. In conjunction with the start of the countdown to the next US presidential elections, by next November.

Technical analysis

Gold price confirmed the breach of 1934.68 after closing the daily candlestick above it and was able to reach our first awaited positive target at 1967.90, waiting for a positive momentum that will push the price to achieve more gains during the coming period, as breaching the last level represents the key to the rally towards 2008.80 as a positive target next.

From here, we will continue suggesting the bullish trend for the upcoming period, noting that breaking 1934.68 will put the price under negative pressure, whose targets start with testing 1901.80 and may extend to 1860.90 before any new attempt to rise.

The expected trading range for today is between 1920.00 support and 1990.00 resistance.

The expected general trend for today: Bullish.