Gold has caught bullish momentum successfully breaking above $1440 area with a daily close. The price has formed non-volatile bullish trend which is expected to continue pushing higher towards $1500.
Gold's value has surged broadly this year as concerns over trade wars and a global economic slowdown rippled through financial markets. Those fears pushed investors toward assets they think could weather market shocks and forced central banks to freeze or cut interest rates, lowering bond yields and making non-yielding gold more attractive. Prices in benchmark US dollars have rallied 15% since May to 6-year peaks above $1,440 an ounce and are at record highs in currencies including the Canadian and Australian dollars and India's rupee. According to certain speculation, Institutional investors want gold to shield them from global economic devaluation and shocks.
China's central bank says it won't let the yuan fall too sharply, but gold longs aren't taking chances, pushing the yellow metal to new six-year highs as safe-havens remained in play as a hedge to the devaluation and heightened U.S.-China trade war. US President Donald Trump's decision to impose a 10% tariff on $300 billion of Chinese imports from September 1st, 2019 suggests that both sides in the trade conflict are taking a harder line, reducing the odds of a resolution in the near term. As of the recent US rate cut effect, for over $1 trillion of bonds now yielding negative interest rates, any further move downwards merely increases gold's relative attractiveness.
TECHNICAL OVERVIEW:
The price is residing above $1475. The price did not encounter any deeper pullback along the way or retest $1440. However, if it reaches $1500, it may lead to bearish intervention as MACD is seen showing lower histograms as the price progresses higher. Certain Bearish Divergence might lead to correction in the market but before $1500 is touched. As the price reaches $1500, it would be interesting to see whether the price breaks above it or rejects for a strong counter momentum.
TECHNICAL LEVELS:
SUPPORT- 1350, 1400, 1440
RESISTANCE- 1480, 1500, 1550, 1600
BIAS- Bullish
MOMENTUM- Non-Volatile
