Today during the Asian trading session, the price of gold has slightly decreased. Gold is still under strong pressure from the USD. Therefore, even in case of high demand for defensive assets, opportunities for a recovery in gold are limited.
Some European countries, such as the UK and France, are introducing new restrictions to contain the spread of the virus. The United States is also seeing an increase in the number of COVID-19 cases as temperatures drop. According to Johns Hopkins University, as of October 16, there are more than 7.9 million cases in the United States and more than 38.8 million worldwide.
A new wave of the virus could significantly slow down the global economic recovery or lead to a new decline. At the same time, investors are no longer betting that a coronavirus vaccine will be developed this year. Considering the above, investors again turned their attention to traditional defensive assets, including gold. But the significant strengthening of the dollar in recent days makes gold more expensive for foreign investors, keeping the demand for gold within certain limits. While the dollar continues to rise, the price of gold and other commodity assets will remain under pressure.
The economic calendar today will focus on US retail sales for September.
Regarding the chart, the situation has practically not changed over the past day. The price remains in the range between the levels of 1892.00-1922.00. Most likely, today the price will remain within the noted range.
The main scenario - a consolidation in the range of 1892.00-1922.00.
An alternative scenario - a breakdown of support at 1892.00 and a decline to 1875.00.
The current fundamental outlook is neutral. We consider longs from the level of 1892.00.
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