Happy Friday, traders, 

It’s been a good week from the trading viewpoint, as Team FXLeaders closed 19 winning signals, achieving a 90% success rate. Regarding gold, the precious metal closed at $1,803.05 after placing a high of $1,815.90 and a low of $1,795.56. Overall, the movement of gold remained bearish throughout the day.

After jumping to a 9-year high in the previous session, gold prices started to decline. However, the market’s safe-haven demand managed to keep the gold prices supported at the 1,800 level. The safe-haven demand was supported by the increase in new coronavirus cases in the US, which raised doubts about US economic recovery.

Data revealed that more than 3 million Americans have already been infected with the coronavirus, with a daily record of more than 60,000 new cases and death tolls around 134,000. The senior member of the White House coronavirus task force said that the US had set a world record by reporting more than 60,000 cases in a day, which indicated that some states needed to pause reopening efforts.

He added that rather than reverting to a complete lockdown, some states should pause the reopening processes. However, any state with serious problems should go for a complete shutdown. He warned that if proper safety measures and social distancing were not maintained, the daily case count could reach 100,000.

A new model by the University of Washington also predicted that the death toll in the US would reach 200,000 by October 1, which cast further doubts regarding the economic recovery.

The US economy contracted by 5% in the first three months of this year, making it the sharpest decline since the Great Recession of 2008-09. That came in after most of the 50 states went into lockdown, in order to contain the spread of the virus. However, most businesses have reopened over the past two months, and economists believe and warn that a double-digit recession could raise its head in the second quarter.

While the US dollar was firm, gold was propped up on the lower end, due to the expectations of more stimulus from the Federal Reserve to support the US economy, which could debase the currency and ultimately raise gold prices.

Gold was torn between its safe-haven status and inflation-hedge characteristics; one was making investors sell the yellow metal in a risk-on sentiment, while the other caused investors to seek refuge in it. That was the reason behind Thursday’s see-saw movement in the gold prices. However, the yellow metal managed to stay above the $1,800 level.

On the data front, at 00:00 GMT, the Consumer Credit from the US declined by 18.3B against the expected decline by 15.2B in May, weighing on the US dollar. At 17:30 GMT, the Unemployment Claims for last week decreased to 1,314K from an expected 1,375K, providing support for the US dollar, which in turn weighed on gold prices. At 19:00 GMT, the Final Wholesale Inventories came in line with the expectations of -1.2% in May.

Due to better-than-expected jobless claims from last week, the strong US dollar weighed on the yellow metal, causing the bearish trend for gold.

Another factor involved in the strength of the US dollar on Thursday was the fall in WSJ’s equity prices, due to the latest news that the US Supreme Court has ruled that the prosecutors could examine President Trump’s financial records in New York. This also weighed on the yellow metal prices, due to the strong US dollar.

Daily Technical Levels

Support Resistance

1797.35 1822.85

1785.85 1836.85

1771.85 1848.35

Pivot Point: 1811.35

The overbought yellow metal GOLD slipped from the $1,816 level, dropping to $1,795. The precious metal gold may find an immediate resistance at around $1,805, and the support level remains at $1,795. Below this, the next support remains at the $1,787 level today. Bearish bias seems solid today. Good luck!