Gold analysis 18.09.2020

Futures contracts for gold prices fluctuated in a narrow range that tends to rise during the Asian session, overlooking the resumption of the US dollar index rebound from its lowest since late April of 2018 for the tenth session in fourteen sessions according to the inverse relationship between them on the cusp of developments and expected economic data today, Friday. By the US economy, the largest in the world, and with concern over a second wave of Coronavirus.

At 06:41 a.m. GMT, gold futures contracts for December delivery rose 0.38% to trade at $ 1,958.60 an ounce, compared to the opening at $ 1,951.10 per ounce, knowing that the contracts started the session on a rising price gap after it concluded Yesterday's trading was at $ 1,949.90 an ounce, while the US dollar index rose 0.02% to 92.91, compared to the opening at 92.89.

Investors are currently waiting for the US economy to release the current account reading, which may reflect the widening of the deficit to $ 158 billion compared to $ 104 billion in the first quarter of the past, before we witness the release of the leading indicators reading, which may reflect a slowdown in growth to 1.3% compared to 1.4% in July. / July, coinciding with the disclosure of the preliminary reading of the University of Michigan Consumer Confidence Index, which may show an expansion to 75.0 versus 74.1 in August.

This comes hours after the expiry of the FOMC meeting on September 15-16, during which interest rates were kept between zero and 0.25%, the program to purchase Treasury bonds by $ 80 billion per month and mortgage bonds by $ 40. At least monthly, and the disclosure at the time of the expectations of members of the Federal Commission for growth rates, inflation and unemployment in addition to the future of interest rates for the next three years.

In another context, the chief EU negotiator for the Brexit file, Michel Barnier, yesterday noted that the coming days will be decisive for the exit negotiations, explaining that the British proposals regarding fisheries give a ray of hope, but they are not sufficient, and that the draft domestic market law in Britain will make a position The European Union is tougher, dismissing as Brussels still hopes for a trade deal with London.

It is noteworthy that the negotiations to reformulate future relations between the United Kingdom and the European Union are in a state of stumbling in the wake of Britain's intention to bypass international law by violating the withdrawal agreement it reached with the Union, which provides for the demarcation of the border between England and Northern Ireland, due to the latter's refusal to leave the European Union. The European customs, which Britain seeks to overcome, arguing that it will not allow the division of the United Kingdom.

Technical analysis

Gold price tested 1934.86 and rebounded upwards from there, which keeps our bullish expectations valid for the upcoming period, as the price crossed the EMA 50 to head towards our first awaited target at 1967.90, reminding you that breaching this level will extend the bullish wave to reach 2008.80 as a next station.

Consequently, we will continue suggesting the bullish trend in the intraday and short term, noting that breaching 1934.86 and holding below it will stop the expected rise and pressure the price to turn downward.

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

The expected trend for today: overall bullish.