Gold analysis 29.10.2020

Futures contracts for gold prices fluctuated in a narrow range slanting to an upward trend during the Asian session, to witness their rebound for the second session from its lowest since September 28, amid the US dollar index rebounding for the second session from its lowest since October 19 according to the inverse relationship between them in conjunction with The continuation of the activities of the senior leaders of China meeting in the Central Committee of the Communist Party of China and following the decisions and directions of the Bank of Japan
 
And on the cusp of economic developments and data expected today, Thursday, by the US economy, the largest economy in the world, and looking forward to decisions and directions of European Central Bank in conjunction with the new closures by the largest economies of the euro area due to the outbreak of the second wave of Corona virus globally, and amid aspiration for the results of the ongoing negotiations between Brussels and London about Future and business relations between them following Brexit.
 
At 07:10 AM GMT, gold futures contracts for December delivery rose 0.27% to trade at $ 1,882.60 an ounce, compared to the opening at $ 1,877.50 an ounce, knowing that the contracts started the session on a downward price gap after it was concluded Yesterday's trading at $ 1,879.20 an ounce, amid the US dollar index retreating 0.05% to 93.39 compared to the opening at 93.43.
 
Investors' attention is currently directed to the activities of the meeting of senior Chinese leaders in the Central Committee of the Communist Party of China, which began at the beginning of this week and continues until tomorrow Friday to plan the course of economic development for the next fifteen years for the largest Asian economy, the second largest economy in the world, the largest consumer of minerals in the world and the second largest country. Industrial in the world.
 
Other than that, we followed the approval of monetary policy makers at the Bank of Japan at its October 28-29 meeting to maintain negative short-term reference interest rates at 0.10%, which came in line with expectations, with the Bank of Japan unveiling its monetary policy statement. And also stay on the pledge to guide the yield of 10-year government bonds at zero.
 
In the same context, monetary policy makers at the Bank of Japan also reaffirmed that additional steps will be taken for monetary easing without hesitation if necessary, and attention is now turning to the actions of the press conference to be held by the Governor of the Bank of Japan Haruhiko Kuroda later today. To comment on the decisions and directions of the Japanese central bank.
 
On the other hand, investors are currently awaiting the American economy to unveil the preliminary reading of the GDP of the United States for the third quarter, which may show the largest economy in the world expanding $ 32.0 compared to a contraction of 31.4% in the second quarter, as it may reflect the initial reading of the measured GDP. In prices for the last quarter, a growth of 2.9%, compared to a contraction of 1.8% in the second quarter.
 
This comes in conjunction with the release of the aid requests index reading for the past week on October 24th, which may reflect a decrease of 14 thousand requests to 773 thousand applications compared to 787 thousand applications in the previous reading, and the reading of the continuous aid requests for the past week may appear on the 17th of This month, a decrease of 673 thousand applications decreased to 8,373 thousand, compared to 7.7 million applications in the previous reading.
 
Coming to the disclosure of housing market data, with the release of the existing home sales reading, which may show a slowdown in the pace of growth to 3.1% compared to 8.8% last August. Otherwise, the tension remains between the two poles of US policy, Republicans and Democrats over the approval of a second stimulus package. To support the economy in the face of the negative repercussions of the Corona pandemic.
 
We would like to point out, however, that the chances of adopting the second stimulus package to support the US economy to face the negative repercussions of the outbreak of the second wave of the coronavirus before the start of the upcoming US presidential elections on the third of next November have diminished over time, and according to the latest figures issued by the World Health Organization. The number of cases infected with the Coronavirus increased to nearly 43.77 million, and 1,163,459 people were killed in 219 countries.
 
This comes before we witness the activities of the ECB meeting and the disclosure of the monetary policy statement amid expectations that interest rates will remain at zero levels, leading to the press conference of the European Central Bank Christine Lagarde to comment on the decisions and directions of the European Central, and the markets hope for the Central Bank to adopt preventive stimulus following the new closings By the largest economies of the euro area, Germany and France, due to the outbreak of the Coronavirus.
 
In another context, negotiators from the European Union and the United Kingdom made progress towards resolving some of the biggest differences existing between Brussels and London, which raised hopes for reaching an agreement between the two parties by early next November on future and trade relations after Britain's exit from the European Union. In late January.
 
Other than that, we followed Tuesday the data of the Gold Association in China that gold consumption increased during the past three months on September 30 from the second quarter by 29% to about 548 tons of gold, while the data reflected a similar decline in the same percentage for the same months of 2019, We would like to point out that the Union had previously reported that China's consumption declined 38% on an annual basis in the first half of 2020 due to the outbreak of Corona and the slowdown in the Chinese economy.

Technical analysis

 
Gold price stabilized around 1880.00 after the strong decline it witnessed yesterday evening, awaiting further decline to achieve our main waited target at 1860.90, noting that the price is facing negative pressure that supports the chances of breaking the aforementioned level and then paving the way for an extension of the downside wave in the short term, Noting that breaking it will push the price to 1794.85 as a next negative target.
 
Consequently, the bearish trend will remain valid and effective for the upcoming period, unless the price pushes to breach 1901.80 and stabilize above it.
 
The expected trading range for today is between 1860.00 support and 1900.00 resistance.
 
The expected general trend for today: Bearish.