The safe-have-metal prices rose as traders await the U.S. Federal Reserve minutes of its latest meeting, which is scheduled to release later in the day. The gold gained 0.2% to $1,607.25 by the time of writing this update.
Gold is higher 5.7% during this year because investors evaluate the impact of the disease on economic growth amid thinking that the Federal Reserve will feel increased pressure to deliver the rate cut. Moreover, fears of the new coronavirus and its impact on global growth pushed the safe-haven metal higher.
Official data showed that new cases in China declined for a second straight day. However, the World Health Organization has cautioned there is not enough data to know if the epidemic was being controlled.
China continues to struggle to achieve the identity of manufacturing in the world’s 2nd-largest economy again after imposing substantial travel restriction and city lockdown to control the virus that has killed more than 2000 peoples so far. However, investors still seem confident that the economic impact may be temporary.
The epidemic is expected to impact business in China and drag down its economic growth. Earlier this month, Moody’s Investors Service has lowered the growth forecast for China from 5.8% to 5.2% for 2020.
Daily Support and Resistance
- S1 1556.92
- S2 1577.08
- S3 1589.29
Pivot Point 1597.25
- R1 1609.46
- R2 1617.41
- R3 1637.58
Technically, the gold prices are likely to face resistance around 1,612. Below this, gold prices are expected to gain support around 1,594 area. A bullish breakout of 1,612 can lead to gold prices towards the next resistance area of 1,622. At the moment, we can either wait for bearish retracement until 1,602 to take a buying trade or enter a buy trade above 1,612 level to target 1,620. Good luck!