Gold breaks the psychological level of $ 1,500 for the first time since the beginning of the year, and is currently trading at almost 4% lower for the day. After peaking at $ 1700 early last week, following the market sentiment, we have seen a drastic drop in the price of precious metal at the end of last week and is currently testing the 200 Daily MA. Breaking this level of support would lead to a further decline.
Against the backdrop of stock sales, gold also suffered losses as many funds sold out to raise liquidity.
On the other hand, global bond yields are moving slowly, and real returns are turning negative. This continues to be a compelling argument for the long-term growth of gold. Against the backdrop of coronavirus infection, which is becoming more widespread and threatening a much greater economic downturn and the potential risk of recession – a reason that would also keep bids in gold.
Resistance: $ 1535-1550
Support: $ 1400-1450
Critical point: 200 DMA – $ 1500
Trader Georgi Bozhidarov