Gold Intraday: Signs of Losing Steam
George Lam June 3, 2020 12:20 PM
Spot gold dropped 0.7% yesterday, halting a three-day rally, and there are signs that the precious metal is losing steam...
Spot gold dropped 0.7% yesterday, halting a three-day rally, and there are signs that the precious metal is losing steam.
The Wall Street Journal reported that U.S. President Donald Trump will consult his advisers on policy options for the next economic stimulus plan. On the other hand, the German government is considering a fresh 100 billion euros aid package, according to Bloomberg.
Meanwhile, Chinese economic activity showed a strong recovery, with the Caixin China Services PMI bouncing to 55.0 in May, much higher than 47.3 expected, from 44.4 in April. The report said "the rate of expansion was the steepest recorded since October 2010".
From a technical point of view, spot gold stays on the downside as it has broken below its previous consolidation range as shown on the 1-hour chart. In fact, it has potentially formed a double-top pattern, and has broken below a bullish channel drawn from May 27. Bearish investors may consider $1,745 as the nearest resistance level, with prices likely to test the 1st and 2nd support at $1,714 and $1,704 respectively. Alternatively, a break above $1,745 would open a path to the next resistance at $1,754.
Source: TradingView, Gain Capital
From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.
As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.