Gold Price Push Higher On Risk-Off Sentiment

Gold price trades higher for the second day close to nine-year highs as the euphoria over a coronavirus vaccine fizzled after reports casts doubts on the reliability of the clinical trial results. Investors shift their attention to safe-haven assets again on fears that the economic recovery will be not so fast without the vaccine. 

Increased trade tensions between USA and China also support the gold price. Nasdaq stock exchange will release new restrictions on IPO’s, which will make it more difficult for some Chinese companies to start trading on the exchange. 

Weak economic data is also gold positive. The U.S. homebuilding dropped to record in April, and building permits for construction tumbled, showing that the coronavirus outbreak would lead to the deepest economic contraction in the Q2 since the Great Depression. Earlier today the Japanese business confidence plunged in May, hitting decade lows. 

ETF investors and traders moved to sidelines as the gold price volatility rises. Gold holdings with the gold SPDR ETF remained unchanged at 1113.78 tonnes, the highest since April 2013.

The gold to silver ratio stands at 100.206 the lowest level since March 16 as the silver gains momentum.

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Gold Price Analysis

Gold price is 0.18% higher at 1,747.68 hovering close to nine-year highs as bulls are in full control of the precious metal during the coronavirus crisis. The technical outlook points to a break above the Mondays high at 1,765. The RSI points to a continuation for the upward trend while traders should consider the pullbacks as a buying opportunity.

On the upside minor resistance stands at 1,753 the daily top. If gold price breaks above, then the next hurdle would be met at 1,765 the nine-year highs. 

On the other side, the first support for gold price stands at 1,743, while more buying interest should emerge at 1,724 the low from yesterday’s trading session. In case the sellers break that point then the next support stands at 1,710 the low from May 14. 

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