Fundamental analytics

Dollar puts pressure on gold

XAUUSD

On Monday, gold finished trading with a slight decline, under pressure from the dollar.

Yesterday there was no important economic news on the market, so investors basically played out data on the US labor market, published on Friday. This report has significantly reduced expectations for the Fed to lower interest rates, which always supports the dollar and US debt securities, and increases the pressure on the yellow metal.

A deterrent for bears was the situation in the stock markets, where the major world indices were trading in the red zone, increasing investor interest in gold and other protective assets. First, the pressure on the market is exerted by the changed expectations regarding the future actions of the Fed. Secondly, investors are still concerned about the situation in international trade. The process of resuming trade negotiations between Beijing and Washington is progressing very slowly. This week only telephone calls are scheduled, within which the parties will agree on a schedule of further meetings. Obviously, in this situation, one cannot expect a quick resolution of the conflict.

Today, important economic reports are not expected to be published again on the market, but Fed officials, including the head of department Jerome Powell, must make a statement, which may clarify the situation regarding further actions by the regulator on possible adjustments to the basic parameters of monetary policy. Therefore, the impact of these statements on the market can be very strong.

On the graph for the day the situation has not changed fundamentally. In the medium term, the bullish trend and the scenario with the growth of quotations in the direction of the level of 1438.00 and above remains relevant. Locally, the situation is more uncertain, because now we see increased pressure on the upward support line, which increases the likelihood of its breakdown and price reduction to 1383.00 and below.

Resistance Levels: 1415.00, 1438.00, 1445.00;

Support levels: 1383.00, 1360.00, 1332.00.

The main scenario is a decline to 1383.00 and a resumption of the upward movement.

Alternative scenario - support breakdown at 1383.00 and a decline to 1360.00.

The market is dominated by a negative fundamental background, but on the chart, the bullish trend remains relevant in the medium term, so today we are considering longs in the area of ​​a strong support level of 1383.00. It is better to enter the market after the formation of a false breakdown of this mark.

 

 

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