GOLD has been quite volatile this year, trying both sides as the sentiment has shifted. It started the year bullish, as with geopolitical tensions between US and Iran and the coronavirus outbreak in China. In March we saw a quick dive lower, after the coronavirus came to Europe, but the crash ended that month and Gold turned massively bullish for the next several months.

The top side is being protected by the 100 SMA

It broke above the 2011 highs, as well as breaking the big round level at $ 2,000 in August this year. But, the break didn’t last long and the price returned back down below $ 2,000 in the second week of August. Since then, sellers have been in control in Gold, although we have seen some decent pullbacks as well.

December for instance has been bullish and Gold has climbed around $ 150. Although, in the last couple of days Gold has been trading in a range between the 100 SMA (green) at the top and the 200 SMA (purple) at the bottom. There is uncertainty regarding the US stimulus package, as well as the coronavirus and the future of the global economy. So, Gold will close the week between these 2 MAs and then will probably decide on the next move next week.

The US stimulus package worht $ 2.3 billion is expected to help the economy as it filters through, which improves the sentiment. In fact, the sentiment should improve right away after the package comes in, so this is a double negative for safe havens. The Brexit deal is another positive factor for the risk sentiment and negative for Gold.

On the other hand, we don’t know how the USD will react; the excessive amount of the US dollars going into circulation should weaken the Buck, but it might also have a positive impact, similar to the reaction of the Euro when the EU stimulus package came in. So, the uncertainty is high now and Gold seem to be closing 2020 unsure what direction to take.