Gold Prices Stop Their 3-Day Winning Streak – Quick Update on Signal

Posted Tuesday, June 2, 2020 by
Arslan Butt • 1 min read

During the European session, the safe haven metal prices failed to extend their previous 3-day winning streak and dropped to $1,737 level from the intraday high of $1,743.32 while representing 0.14% drop mainly due to the broad-based US dollar strength amid a risk-off market sentiment. On the other hand, the ongoing tension between the United States and China drove additional losses in the gold prices, at least for now. The yellow metal prices are currently trading at 1,737.70 and consolidating in the range between 1,735.74 and 1,743.37.

The modest GOLD declines could also be attributed to the positive data from the world’s two largest economies, suggesting that the global economic recovery from COVID-19 was on track. Additionally, China witnessed economic development as it reported its official manufacturing Purchasing Manager’s Index for May on Monday, and the US reported a modest rise in manufacturing activity from an 11-year low which also pushed investors to withdraw their money from the safe-haven assets which eventually contributed to the yellow metal’s declines.

At the US-China front, the tension between the world leaders seems to be getting worse day by day as the Chinese government decided to stop the purchases of American soybeans and other US agricultural goods. The Chinese buyers also canceled some US pork orders, which eventually fueled the long-lasting trade tussle between them. Despite this, the yellow-metal buyers failed to cheer these problematic headlines and remain under pressure due to the broad-based US dollar strength.

Daily Support and Resistance
S1 1702.64
S2 1720.05
S3 1729.83
Pivot Point 1737.47
R1 1747.24
R2 1754.88
R3 1772.3

At the moment, we are looking to open a buying trade over 1,740 level which is working as a nice breakout level. On the higher side, we are looking to place a take profit at 1746 along with a stop loss around 1736.28.

Good luck!

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