Gold analysis 22.09.2020

Futures contracts for gold prices fluctuated in a narrow range that tends to rise during the Asian session, to witness its rebound for the second session from the lowest since August 12, amid the dollar index rebounding for the second session from its highest since the same day according to the inverse relationship between them on the cusp of developments and expected economic data today Tuesday by the US economy, the largest economy in the world, which includes the first half of Fed Governor Jerome Powell's semi-annual testimony before Congress and amid growing concern over a second wave of Coronavirus.

At exactly 06:06 AM GMT, gold futures contracts for December delivery rose 0.13% to trade at $ 1,920.50 an ounce, compared to the opening at $ 1,918.10 an ounce, knowing that the contracts started the session on a rising price gap after it closed Yesterday's trading at $ 1,910.60 an ounce, with the US dollar index declining 0.03% to 93.53 compared to the opening at 93.56.

Investors from the US economy, the largest industrial country in the world, are awaiting the release of the Richmond Industrial Index reading, which may reflect a contraction of the expansion to a value of 12 compared to 18 last August, in conjunction with the disclosure of housing market data with the release of the annual home price index reading, which It may show a slowdown in growth to 2.4% to about 6.05 million homes, compared to 24.7% at 5.86 million homes last July.

This comes before we witness the first half of the semi-annual testimony of Federal Reserve Governor Jerome Powell before the US Congress, specifically before the House Financial Services Committee in Washington on the "CARES" Act, and Powell is expected to testify before the House Select Committee tomorrow. Wednesday, about the economic effects of the Corona pandemic, before he gave the second half of his testimony, tomorrow, Thursday, to the Senate Banking Committee.

We would like to point out that Treasury Secretary Stephen Mnuchin will also deliver his testimony on Thursday, with Powell, about the CARES Act before Congress. The repercussions of the Corona pandemic, with his assertion that there is a need for more fiscal and monetary policy to prevent the health crisis from causing long-term damage to the economy.

Technical analysis

The price of gold faced strong negative pressure, as we mentioned in our technical updates yesterday, and it made attempts to break the 1901.80 level, to show signs of a negative technical combination indicating that the price is on its way to achieve further decline during the coming period, noting that the confirmation of a breach of 1901.80 will push the price to 1860.90 As the next negative terminal.

Thus, the bearish trend will be expected in the intraday and short term, taking into consideration that breaching 1934.86 will stop the expected decline and lead the price to recover and restore the main bullish trend again.

The expected trading range for today is between 1880.00 support and 1935.00 resistance.

The expected general trend for today: Bearish.