During the Asian trading session on Monday gold reached its highest trading levels since early May. Investors are actively buying protective assets due to the general market uncertainty caused by reports of an increase in the number of cases of COVID-19 in the world.
According to WHO, 183020 new cases of virus infection were detected around the globe on Sunday. Investors fear that a new outbreak of the virus will slow down the process of global economic recovery, which is favorable for gold.
Pressure on the market was also exerted by reports of some FRS officials regarding a possible increase in the number of unemployed if the situation with the virus in the country cannot be taken under control. Representatives of the FRS once again stated that the process of economic recovery in the United States will be longer and more complicated than previously expected.
The positive impact on gold continues to have the news of geopolitics. On Saturday, China published the details of the National Security Act, which will be introduced in Hong Kong and Macau. According to the information provided, Beijing will obtain fairly broad powers. The law is expected to be enacted from June 28-30. This could lead to another exacerbation of Sino-American relations.
Regarding the chart, an upward breakthrough of the 1705.00-1745.00 range occurred which is a signal in favor of the development of further upward movement. The target is a local maximum at the level of 1765.00.
Resistance Levels: 1765.00, 1780.00, 1800.00;
Support Levels: 1745.00, 1723.00, 1705.00.
The main scenario - a rollback to 1745.00 and growth in the direction of 1765.00.
An alternative scenario - a decline towards 1723.00.
The current fundamental outlook is moderately positive. We consider longs from the level of 1745.00
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