Gold Intraday: Safe-Haven Demand Fades on Easing Coronavirus Cases

U.S. recorded the smallest increase in new confirmed coronavirus in nearly a month yesterday, while U.K. and Italy also showed slower pace of spread...

Gold 5

Spot gold lost 0.9% on day to $1,714 on Monday and dipped further to $1,704 during Asian trading hours today. According to Johns Hopkins University, U.S. confirmed coronavirus cases rose 2.3% yesterday, the smallest increase in April, while U.K. and Italy also showed slower pace of spread. Global central banks have introduced a series of rate-cuts and quantitative easings during the crisis, and passing the coronavirus peak would imply that ultra-loose monetary policies maybe about to end. Will this mark a downturn for gold price remains to be seen, the intraday outlook for the precious metal does not look decent.

From a technical point of view, spot gold is under pressure as shown on the 1-hour chart. It has retreated after another failed attempt to break through its previous high, and has now broken below a bearish descending triangle pattern. The level at $1,721 may be considered as the nearest resistance, with price likely to head towards $1,691 (38.2% Fibonacci retracement of the rally started in April 21) and $1,680 in extension. In an alternative scenario, a break above $1,721 might suggest that it would test $1,739 again.

Source: TradingView, GAIN Capital

More from Gold

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

Open an Account