Gold analysis 03.09.2020

Futures contracts for gold prices fluctuated in a narrow range slanting to rise during the Asian session, overlooking the rebound of the US dollar index for the third consecutive session from its lowest since late April of 2018 according to the inverse relationship between them on the cusp of developments and economic data expected today, Thursday, by the economy The US is the largest economy in the world.

At exactly 4:58 a.m. GMT, gold futures contracts for December delivery rose 0.11% to trade at $ 1,951.00 per ounce compared to the opening at $ 1,948.90 per ounce, knowing that the contracts started the session on a rising price gap after it concluded Yesterday's trading was at $ 1,944.70 per ounce, while the US dollar index rose 0.20% to 92.84 compared to the opening at 92.66.

Investors are currently awaiting the American economy to reveal the final reading of the productivity index and the cost of one work, and it is expected that the reading of the productivity index will show stability of growth at 7.3%, with little change from the preliminary reading for the second quarter, compared to a contraction of 0.9% in the previous reading for the first quarter, while The cost index reading shows slowing growth to 12.0% compared to 12.2% growth in the preliminary reading and versus 5.1% growth in the first quarter.

This comes in conjunction with the release of the aid requests index reading for the past week on August 29th, which may reflect a decline of 51 thousand applications to 955 thousand applications compared to 1,006 thousand applications in the previous weekly reading. Also, the reading of continuous aid requests for last week may appear on the 22nd of August. Last month, a decrease of 535 thousand requests to 14 million requests compared to 14,535 thousand requests in the previous weekly reading.

This also comes in conjunction with the release of the merchandise trade balance reading, which may explain the widening of the deficit to a value of $ 58.2 billion compared to $ 50.7 billion in June, and before the release of the final reading of the Institute for Service Provisioning Index by Markit from the United States, which may reflect the stability of the expansion at A value of 54.8, unchanged from what it was in the preliminary reading for the past month, and compared to a widening of 50.0 in July.

Up to uncovering the index reading of the Service Provisioning Institute, whose importance lies in the fact that the service sector represents more than two-thirds of the GDP of the United States, which may explain the contraction of the expansion to a value of 57.0 compared to 58.1 in July, and it is mentioned that the US economy reversed worse in the second quarter. His performance since the Great Depression in the 1930s due to the Corona pandemic and recently reflects signs of recovery and that the worst is over.

Technical analysis

Gold price touched 1934.86 and built a base on it to start rebounding upwards from there, which supports the chances of the trend to resume the main bullish trend, as the price moves within a main ascending channel that has positive targets surpassing the recently recorded peak at 2074.87.

Thus, a bullish bias will be expected for today, and nearby targets start by surpassing 1967.90 to open the way to heading towards 2008.80, bearing in mind that breaching 1934.86 will stop the expected rise and pressurize the price for more bearish correction in the intraday and short term.

The expected trading range for today is between 1930.00 support and 1980.00 resistance.

The expected general trend for today: Bullish.