Gold analysis 06.11.2020

Gold futures fluctuated in a narrow range that tends to decline during the Asian session, to witness its retracement of the second session from its highest since September 21, overlooking the retracement of the US dollar index for the third session from its highest since the 28th of the same month according to the inverse relationship between them on the cusp of developments and data Economic anticipated Friday by the US economy, the largest economy in the world, and in conjunction with the continued counting of American voters within the actions of the US presidential elections.

At exactly 05:45 am GMT, gold futures contracts for December delivery fell 0.49% to trade at $ 1,940.40 per ounce, compared with the opening at $ 1,950.00 per ounce, knowing that the contracts started the session on a rising price gap after trading concluded Yesterday at $ 1,946.80 per ounce, overlooking the decline of the US dollar index 0.10% to 92.61 compared to the opening at 92.70.

Investors are currently awaiting the US economy to disclose labor market data, with the release of the employment change index reading for sectors other than agricultural, which may reflect 595 thousand added jobs compared to 661 thousand jobs added last September, while the average hourly income index reading may clarify. Growth accelerated to 0.2% versus 0.1%. This is with the unemployment rate reading showing a decline to 7.7% from 7.9% in September.

This comes, before we witness the release of the final reading of the wholesale inventories index, which may confirm a decline of 0.1%, unchanged from the previous initial reading for the month of September and compared to a rise of 0.4% last August, leading to the disclosure of the reading of the consumer credit index, which may Reflects an increase to $ 7.9 billion compared to a decline of $ 7.2 billion in August.

In another context, we have just watched the end of the November 4-5 FOMC meeting via satellite in Washington, during which the Fed’s monetary policymakers decided to maintain the short-term reference interest rates for the sixth consecutive meeting at Its lowest level was between zero and 0.25%, which was in line with expectations.

Yesterday, we also followed the press conference held by Federal Reserve Governor Jerome Powell, half an hour after the end of the meeting, to comment on the decisions and directions of the committee, in which he expressed the importance of the fiscal stimulus policy to support the economy amid his emphasis on the Federal Reserve's commitment to using all its tools to support the recovery.

Technical analysis

The price of gold closed yesterday's trading above 1934.86, paving the way to continue the bullish trend in the intraday and short term, on its way to heading towards 1967.90 as a next positive target, noting that the price has completed forming a double bottom pattern that has positive targets beyond the aforementioned level to reach 2008.80.

Thus, we expect to witness more upside during the upcoming sessions, waiting for a positive momentum that will contribute to pushing the price to achieve the suggested targets, bearing in mind that breaking 1934.86 and stabilizing below it will put the price under negative pressure targeting a test of 1901.80 areas initially.

The expected trading range for today is between 1910.00 support and 1970.00 resistance

The expected general trend for today: Bullish