Gold price retreat back to the 1,800 mark after failing to break above the nine-year highs failing to capitalize yesterday the pressure in risky assets amid worries of second coronavirus wave as the new coronavirus cases continue to rise in the southern states in the USA. Texas, Arizona, and California have shut down the restaurants, bars and cinemas in an attempt to contain the spread of the virus.
Rising tensions between China and the USA in the South China Sea and news that the European Union planning counter-measures in response to Beijing’s new security law for Hong Kong is gold positive.
Gold hit the highest level since September 2011 the previous week on fears of a second COVID-19 wave. A record number of new coronavirus infections in the USA and across the globe boosted gold price. Investors continue to buy the SPDR gold ETF, and the gold holdings of the ETF rose by 3.5 tonnes marking the highest level since 2013.
Gold Technical Analysis
Gold price is 0.23% lower at 1,798, as investors await a catalyst for the next trend, as the recent rally stalled at 1,820. The technical bias is clearly bullish for the gold price, but a move below the 1,800 mark might lead to profit-taking.
On the downside, first support for gold stands at 1,796 the daily low. A break below might challenge 1,773 the low from July 7 trading session. If the sellers continue the pressure, then the next support area stands at 1,740 the 50-day moving average.
On the other side, the gold price will face resistance at 1,803 the daily high. If the gold breaks above 1,803, then the next resistance would be met at 1,810 the high from July 10 while the next supply zone is at nine-year highs at 1,820.
Gold Price Daily Chart