Gold First Meaningful Upside Breakout
Spot gold climbed 0.8% to $1,730.3 yesterday, up for a third straight session and confirmed the first meaningful upside breakout.
It becomes more clear that U.S. President Donald Trump is playing a mind game with China, aiming to divert public attention away from his ineffective response to the coronavirus in the early stages.
In an interview with Fox Business Network, Trump said he was disappointed with China over its handling of the health crisis, threatening that he "could cut off the whole relationship". He also launched new measures against China, as he is "looking at" Chinese companies listed on the U.S. stock exchanges, which do not follow his country's accounting rules.
From a technical point of view, spot gold has confirmed an upside breakout as shown on the daily chart. It has broken above a symmetrical triangle pattern, signaling an end of the consolidation and a resume of bullish trend. The level at $1,685 might be considered as the nearest support, and a break-through from the 1st resistance at $1,748 would open a path to the next resistance at $1,790. Alternatively, losing $1,685 may trigger a pull-back to $1,640.
Source: TradingView, Gain Capital
For intraday as shown on the 1-hour chart, spot gold remains on the upside after breaking above an ascending triangle pattern, targeting April high. Bullish investor may consider $1,723 as the nearest support, with 1st and 2nd resistance likely to be located at $1,743 and $1,748 respectively. In an alternative scenario, a break below $1,723 might trigger a return to $1,711 on the downside.
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