Gold price ease today after the precious metal yesterday hit the highest level since September of 2011 on fears of a second coronavirus wave. This week reported a record number of new coronavirus infections in the USA while Australia is considering the full lockdown for four weeks in the state of Victoria.
Federal Reserve MPC members warned that the economic situation might prove worse than expectations and the recovery would be a bumpy process, and reiterated that the economy might need more stimulus in the upcoming months.
The last weeks we can see a correlation between risky assets such as stocks and gold. Looking at the daily charts when the shares trade higher gold is also trading higher, and some analysts believe that the excess liquidity is even buying gold despite the defensive profile of the precious metal. Gols is also attracting bids on the down days for equities as see gold as a safe haven asset meaning that gold is getting bids regardless of what is the sentiment in the markets and that might be the reason why gold is at nine-year highs.
Gold Price Daily Technical Analysis
Gold price is 0.03% higher at 1,809, in a muted session as the price digesting, after the recent breakout, the nine-year highs. Yesterday gold price made fresh eleven-year highs at 1,818.14 confirming that bulls are in full control. The technical outlook is bullish for the gold price, and new highs might soon be reached if the $1,800 level holds on for a few daily closings.
On the upside, gold will face resistance at 1,810 the daily top. If the gold price breaks above 1,810, then the next resistance would be met at 1,818 the nine-year highs. If the price breaks above, then bulls would challenge the 1,825 round figure.
On the contrary, initial support for gold price stands at 1,808 the daily low. A break below might challenge 1,790 the low from yesterday’s trading session. If the bears continue the pressure, then the next support area stands at 1,755 the low from July 6.