On Tuesday, during the Asian trading hours, the safe haven metal prices have recovered to $1,724, mainly due to the risk-off market sentiment in the wake of the escalated threat of coronavirus earlier. However, now, the fresh declines in the coronavirus cases weighing on gold prices and prices dropped again to 1,716.90. Currently, GOLD is trading at 1,711.40 and consolidating in the range between 1,701.90 and 1,722.40. However, the Easter Monday holiday in major countries limited the safe-havens moves yesterday, but traders should be back now, and we may see some movement in the market.
As per the latest report, China’s Hubei recorded no fresh coronavirus cases for the second day while South Korea’s virus cases recently dropped to a seven-week low. Moreover, data from Germany also indicates slowdown to a three-week low, adding 2,537 fresh cases to 123,016 on April 13.
At the US front, the number of cases from the US have risen to 556,000, as per the latest report, while the death toll rose to 22,073, according to data from Johns Hopkins University. This is the major reason behind the earlier risk-off market sentiment.
On the other hand, the stock futures dropped by almost 2% in early Asia mainly due to a drop in WTI crude oil prices despite the decision by the OPEC+, a group of 24 nations led by Saudi Arabia and Russia, to cut the oil output by 9.7 million barrels per day. As a result, the US stock futures recorded more than 1.0% losses by press time, whereas Japan’s NIKKEI225 also dropped to 1.50% to 19,070 by the time of writing.
Looking forward, traders will keep their eyes on the coronavirus related headlines for taking near-term trading impetus. The lack of major data and events could keep traders quiet ahead.
Daily Support and Resistance
Pivot Point 1706.11
Technically, gold is likely to maintain a bullish bias as it has formed a bullish channel on the 4-hour timeframe. Gold may find immediate support around 1,702 level today, while resistance continues to stay around 1,725. A bullish breakout of 1,725 level can lead to gold prices further higher until the next resistance level of 1,744.
The MACD is holding over 0, which is demonstrating bullish bias among traders. Hence, we should look for bullish trades over 1,706 today.