Gold finished trading on Monday with a slight decrease of 0.5%, even despite the weakening dollar, which has recently been the main factor affecting the yellow metal.
On Monday, investors were selling the dollar, continuing to play the report of the US Department of Labor, published on Friday. Many traders believe that weak data on the number of newly created jobs are a weighty argument for the further implementation of a softer monetary policy by the Fed. Dollar depreciation is always a strong support factor for gold, but yesterday other events had a major impact on trading.
Major world indexes opened a new trading week with a good growth. All trading floors, from Asia to the United States, have demonstrated growth, reducing investor interest in defensive assets such as gold and yen. Today index growth continues. Investors have been very positive about the reports that the UK and the EU have reached certain agreements that can be supported in the British Parliament. Europe did not agree to change the agreement reached in November 2018, but agreed on a number of additional documents that clarify the mechanism for regulating the Irish border and provide the UK with additional guarantees for overcoming the EU’s economic influence if there is no trade agreement between the parties after the transition period.
Today, gold managed to recover some of the positions lost yesterday, thanks to a decline in the dollar, whose index has dipped 0.13% since the beginning of the day. However, positive investor sentiment in the stock markets remains a serious deterrent for buyers.
Today, the focus of investors will be on events taking place in the UK. In addition to the publication of important data on GDP, industrial production and manufacturing industry, in the evening the vote on the Brexit project should start. In the US, traders will focus on the publication of data on the consumer price index for February.
On the chart, despite yesterday's decline, there is a good opportunity to resume upward movement. The price tested the upper limit of the channel 1284.00-1291.00, from which it bounced upwards, which is a good signal for the further development of the bullish wave with the immediate target at 1300.00 and further growth opportunities to 1310.00.
Resistance Levels: 1300.00, 1310.00, 1320.00;
Support levels: 1293.00, 1290.00, 1285.00.
The main scenario - growth to 1310.00.
Alternative scenario - price fixing below 1296.00 and a decline to 1290.00
The uncertainty on the market has increased, since factors that act in different directions have an impact on gold. Nevertheless, there are signals on the chart in favor of the development of the bullish movement, therefore, we give priority to longs that should be looked for near the level of 1290.00.
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