Daily Brief, Jan 04 – Everything You Need to Know About Gold Today!

On Sunday, Prime Minister Boris Johnson warned that thougher lockdown restrictions were highly likely to be inplemented in England, as the country struggles to battle the new strain of coronavirus that has pushed the infection rates to record levels. School unions have called for the closure of all schools for a couple of weeks, as the coronavirus is spreading faster, but Johnson insisted that parents should send children to school, as the threat to young kids from the deadly virus is very low.

Meanwhile, Canada counted around 4,800 new cases of the coronavirus on Saturday, which pushed the country’s total caseload up to 586,425. After the holiday break, several provinces started reporting new cases of the coronavirus. In India, the total number of coronavirus cases reached 10,341,291, after 16,660 fresh cases were reported in just one day.

Given the rising number of coronavirus cases and restrictions in the country, in an attempt to control the spread of the virus, Americans have started flocking to Mexico, either on vacation or settling there, to avoid the restrictions. In November, more than half a million Americans traveled to Mexico, and this led to a surge of coronavirus infections in Mexico, with the country reporting new highs in daily cases in November and December.

The rising number of coronavirus cases worldwide, despite the vaccine rollout, has raised fears that countries will impose new lockdown restrictions that will negatively impact economic recovery. This pessimism in the market has added to the appeal for safe-havens, pushing the yellow metal prices on Monday. On the data front, at 19:45 GMT, the Final Manufacturing PMI from the US for December is expected to come in at 56.3, against the previous 56.5. If the actual result matches the expectations, this would weigh on the US dollar. At 20:00 GMT, the Construction Spending for November will be released. It is expected to decline to 1.1%, against the previous 1.3%, and that would also be harmful to the US dollar and could be beneficial for GOLD prices.

Furthermore, the investors’ focus is also on Tuesday’s Georgia runoff elections that will decide the control of the US Senate and, with it, the likely fate of President-elect Joe Biden’s legislative agenda. The US Senate ended the hopes for an increase in direct payments of coronavirus aid checks to the people from $ 600 to the $ 2,000 demanded by Donald Trump with the backing of the Democrats; however, the Republicans blocked Senate efforts. This report has also added to the upward momentum of the gold prices on Monday.

Daily Technical Levels
Support               Resistance
1,887.84              1,903.64
1,880.57              1,912.17
1,872.04              1,919.44
Pivot Point:        1,896.37

GOLD is trading sharply bullishly on Monday, at the 1,919 level. The precious metal GOLD has violated the ascending triangle pattern at the 1,898 level on the daily timeframe, and the metal is now likely to face resistance around the 1,927 level. A continuation of the bullish trend could extend the buying trend until the 1,956 area. However, GOLD may find support at the 1,906 level today. The MACD and RSI are overbought, and they may drive a slight correction in the GOLD price, until 1,906, before extending another bullish wave today. Good luck!