After a small correction, gold resumed its upward movement and is held above $1800 per ounce.
Moderate pressure on gold and other protective assets is exerted by the situation on stock exchanges. Asian indices closed today in the green zone. Despite the risks associated with the pandemic, many investors hope for a sustainable recovery of the global economy in the long term. Government officials in the United States, France and other countries have already announced that, in case the epidemiological situation worsens, targeted quarantine measures will be applied to avoid serious constraints of the economy.
Despite moderate optimism among investors, demand for gold remains stable, due to which it remains in the region of 8-year trading highs. Short and medium term prospects for the development of the global economy remain uncertain. Investors diversify their risks by buying gold.
A soft long-term growth driver for gold is the soft monetary policies among Central Banks, primarily the FRS. The US Congress Approved an Economy Stimulation Program worth 2 Trillion dollars in July. FRS Deputy Chairman Richard Clarida on Tuesday promised additional support from the central bank. Perhaps in the near future the White House will announce new incentive measures.
In the economic calendar today it is worth paying attention to the publication of weekly data on the number of initial applications for unemployment benefits in the United States.
A bullish trend continues to develop on the chart. The bulls manage to keep the price above the level of 1800.00. At lower time intervals, there are no reversal signals. The priority scenario remains with the growth of quotes. The target is the level of 1820.00.
Resistance Levels: 1820.00, 1830.00, 1850.00;
Support Levels: 1800.00, 1774.00, 1760.00.
The main scenario - a decline to 1800.00 and an increase in the direction of 1820.00.
An alternative scenario - an increase by 1820.00 from current levels.
The current fundamental outlook is moderately positive. We would consider longs in the region around the level of 1800.00.
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