At the beginning of the trading day, gold showed a rather significant decline amid concerns about the outcome of the US presidential election. By the beginning of the European trading session, gold had won back about half of its previously lost positions.
The market's sharp reaction was caused by the appearance of the first voting results. Unexpectedly for many, Donald Trump was able to win in a number of key states and, according to interim estimates, both presidential candidates are gaining the same number of votes. According to Fox News, Trump and Biden each gain 233 votes in the electoral college. At the same time, Donald Trump is the leader in the states of Ohio and Texas. Biden is ahead of his Hawaii rival. It’s important to note that earlier nationwide polls predicted the victory in the elections for Joe Biden.
Uncertainty about the election results sharply increased investor interest in the US currency, which was the main reason for the decline in gold prices. Now the dollar index is showing an increase of 0.4%, while gold has lost about 0.6% in price.
The presidential race turned out to be more intense than previously expected. Donald Trump is ahead of his opponent in a key state - Florida. Both candidates can receive an equal number of electoral votes. In this case of equality of votes, the outcome of the elections will be determined by the House of Representatives of the Congress, where the representation of each state will have one vote.
Today, all attention will be focused on the US presidential elections, the results of which will be announced at the end of the day.
On the chart, buyers tried to break through the resistance at 1910.00, but to no avail. The price is still holding in the range between the levels of 1888.00-1910.00. The further medium-term price movement vector will depend on the direction of the price exit from the sideways trend. Breakdown of the level of 1910.00 is a signal in the direction of the development of an upward movement with targets at the levels of 1930.00 and 1967.00.
A breakdown of the 1888.00 mark will indicate a priority in favor of the development of the downward movement to 1867.00 and 1853.00.
The main scenario is a breakdown of resistance at 1910.00 and growth to 1930.00.
An alternative scenario is a consolidation in the range of 1888.00-1910.00.
The current fundamental outlook is neutral. We consider longs with very moderate risks from the level of 1888.00
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