Daily Brief, Nov 6 – Everything You Need to Know About Gold Today! - Forex News by FX Leaders

Daily Brief, Nov 6 – Everything You Need to Know About Gold Today!

Posted Friday, November 6, 2020 by
Arslan Butt • 2 min read
Good morning traders,

Prices for the precious metal, gold, closed at 1,949.32, after placing a high of 1,952.73 and a low of 1,902.07. Gold rose sharply against the US dollar on Thursday, reaching its highest level since Sept 21.

Gold prices rose more than 3% on Thursday; it was the biggest post-summer rally in gold prices, on the back of a weakened US dollar, due to expectations that the US presidential election could soon present a winner, who will finally deliver the US coronavirus stimulus package.

Another reason behind the downward momentum of the greenback was the latest decision of the Bank of England to boost its stimulus package, which raised the equity market and ultimately put pressure on the US dollar.

The winner of the US presidential election of 2020 has yet to be announced, after Tuesday’s voting; it has yet to be decided whether President Donald Trump will stay in office for another four years, or whether his challenger, Joe Biden, will wrest the White House from his grasp.

According to the vote counting, Biden appears set to defeat Republican President Donald Trump. However, the Trump campaign has announced that it expects to launch more legal action and will finally emerge victorious.

These ongoing tensions and the delayed results of the US election weighed on the US dollar, exacerbated by the expectations that regardless of the winner, the elected government will have to issue a stimulus relief package soon, to aid the economy, which is struggling through the coronavirus pandemic. These expectations kept the safe-haven metal prices higher on Thursday.

On the data front at 17: 30 GMT, the US Challenger Job Cuts for the year came in at 60.4%, in comparison to the previous 185.9%. At 18:30 GMT, the Unemployment Claims for last week surged to 751K against the anticipated 740K, weighing on the US dollar. The Prelim Nonfarm Productivity for the quarter rose to 4.9%, against the projected 3.6%, also putting pressure on the US dollar. At 18:32 GMT, the Prelim Unit Labor Costs for the quarter came in at -8.9%, against the anticipated -10.0%, lending support to the US dollar.

The equity market surged on Thursday, with NASDAQ, S&P 500 and Dow Jones Industrials up by more than 2%. The European stocks also hit 2-week highs, thanks to strong earning results, and the Bank of England increasing its already huge bond-buying stimulus by 150 billion pounds. The rise in the equity market also weighed on the US dollar and added strength to the gold prices.

Daily Technical Levels
Support              Resistance
1,915.56              1,966.91
1,883.73             1,986.23
1,864.41             2,018.16
Pivot Point:       1,934.98
The precious metal, gold, has violated the double top resistance at the 1,929 level, having soared to the 1,952 range. On the higher hand, gold could now face resistance in the 1,952 and 1,965 areas. The odds of bearish correction also remain high until the 1,937 and 1,927, which are the 23.6% and 38.2% Fibonacci levels. Good luck!
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About the author

Arslan Butt // Index & Commodity Analyst
Arslan Butt is our Lead Commodities and Indices Analyst. Arslan is a professional market analyst and day trader. He holds an MBA in Behavioral Finance and is working towards his Ph.D. Before joining FX Leaders Arslan served as a senior analyst in a major brokerage firm. Arslan is also an experienced instructor and public speaker.
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