Gold made a new closing high as it added further gains on account of a worsening global scenario as U.S – China trade war intensified along with U.S Federal Reserve’s hawkish stance towards much anticipated rate cuts sending riskier asset class spiraling down again after a brief pause. Once again the “Pandora’s Box” opened with a plethora of negative surprises over the last 3 days almost covering every part of the globe as slowdown and geopolitical concerns continues to haunt aiding the already over-demanding need for safe haven which suggests prolonged bullishness ahead for gold . To watch next week – GDP (U.S) and other important data.
Gold continued to rise as it added another $13 closing well above the previous close clearly suggesting the mood of the market as investors kept flocking to the safety of gold in a very volatile environment shadowed by pessimism of a big economic slowdown. Gold failed to make a new high which can be a negative but nevertheless situation both fundamentally and technically support higher prices. We have 2 scenarios –
1. Gold closed above the support, till this is held it can move to $1541. Once this is crossed it can rally to $1554. And if this is taken out it can move towards $1571.
Short trades remains nullified as bullishness continues except scalp trades.
Bullish view – Bulls yet again made a new closing high (weekly) making it 4 on the trot as fears of an imminent slowdown continues to linger. The ongoing trade wars mainly U.S-China never seems to take a breather fueling the gold prices due to the uncertainty it has cast over the world pulling down riskier assets at an increased pace. The global situation can never be better for gold prices but for a smooth rise it needs to take out the high which will keep it on track for achieving $1800 sooner than expected.
Bearish bets remain ignored in such a bullish scenario.
On larger terms, Gold remains bullish and prices are expected to head higher.
Possible trades are on both sides but mainly on upside, gold can be bought above $1531 for the targets of $1541 and $1554 with a stop loss placed below $1518. Longer term target $1571.
Reference: Trading View
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