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·         Gold Price Analysis: Next significant support for XAU/USD is located at $1,840

 

The renewed USD strength on Friday forced gold to drop below $1,880 and post losses for the second straight week. If the downswing extends, a test of the 200-day moving average at $1840 will be inevitable, FXStreet’s Eren Sengezer briefs.

 

Buyers are having a hard time staying in control

 

“A hawkish shift in the Fed’s tone amid an improved economic outlook and rising price pressures could provide a boost to the USD and weigh on XAU/USD in the second half of the week. On the other hand, the greenback is likely to underperform if FOMC Chairman Jerome Powell downplays inflation concerns and reiterates that they are not even thinking about tapering.”

 

“A daily close below $1,873 could open the door for additional losses toward $1,855 (June 4 low) and $1,840 (200-day SMA).”

 

“A tough resistance seems to have formed at $1,900, a psychological level. In case buyers manage to lift the price back above that level, the next target could be seen at $1,916 (June 1 high).”

 

 

Gold (1855.30) has fallen sharply to test support at 1860. Failure to remain above 1860 would make Gold vulnerable to a fall towards 1840-1820 on the downside before any bounce can take place. That said, a possible rise in Dollar Index towards 91-91.50, if seen would be bearish for Gold in the near to medium term limiting the immediate upside to 1920/00. Watch price action on Dollar Index

 

Silver (27.88) is holding below crucial resistance at 28.50 and while that holds, we may expect a fall towards 27.50-27.00 in the near term. While above 27, the broad range of 27-28.50 may continue to hold.

 

Copper (4.5395) has risen a bit and needs to continue the rise to test higher levels of 4.58/60 again in the near term. Immediate range of 4.45-4.60 may hold for now.

 

 

·         Gold can still fall further but exercise caution before selling

If you followed the idea, you made a killing when Gold dropped to 1875.

 

Currently, from the long term perspective, I still see a chance of further drop in Gold . But,

1902 level, then you can keep some of your sells open for 1850 target.

 

Fresh sells can be executed when price reaches at least 1895 region again just to be safe.I will

keep updating the idea in case I find a better entry price.

 

·         More support for businesses expected if UK delays lockdown easing - minister

More government support for businesses is likely if there is a delay to easing Britain's lockdown restrictions, junior health minister Edward Argar said on Monday.

British Prime Minister Boris Johnson is expected to announce later on Monday that the end of COVID-19 restrictions due on June 21 will be delayed following concern about the rapid rise of infections from the Delta variant of the coronavirus.

 

·         Dovish ECB keeps Italy bond yields at lowest in almost 8 weeks

Italy’s 10-year sovereign borrowing costs were pinned at their lowest levels in almost eight weeks on Monday, with a view that the European Central Bank is in no rush to taper its aggressive emergency stimulus supported by comments by its president.

The euro zone economy is at a turning point but its recovery must be firm and sustainable before the central bank can debate clawing back emergency support, ECB President Christine Lagarde told Politico in an interview.

This backdrop has supported euro zone bond markets in recent days, allowing yields to fall further.

 

 

·         NATO to toughen G7 message on China despite Beijing’s cries of ‘slander’

 

NATO leaders are expected on Monday to brand China as a security risk to the Western alliance for the first time, a day after the Group of Seven issued a statement on human rights and Taiwan that Beijing said slandered its reputation.

 

 

·         China denounces G7 statement, urges group to stop slandering country

 

·         Taiwan says will be ‘force for good’ after unprecedented G7 support

Taiwan will be a “force for good” and continue to seek even greater international support, the presidential office said, after the Chinese-claimed island won unprecedented backing from the Group of Seven of major democracies.

 

·         Saudi first quarter GDP shrinks 3%, hit by oil sector decline

Saudi Arabia’s gross domestic product fell 3% in the first quarter, slightly less than official estimates and compared with a 1% contraction last year, as a sharp fall in the oil sector pulled back the economy, data showed.

 

 

·         Indonesia c.bank to keep key rate at record low for 4th straight meeting

 

Indonesia’s central bank will likely keep interest rates at record lows on Thursday, a Reuters poll showed, after its governor pledged to keep monetary policy accommodative for a while as inflation remains below target and COVID-19 cases rise.

 

All 26 economists in the poll unanimously expected Bank Indonesia (BI) to hold the benchmark interest rate (IDCBRR=ECI) at 3.50% for a fourth consecutive meeting.

 

 

·         Virus outbreaks at Thai factories threaten export sector, recovery

 

A series of coronavirus outbreaks in Thai factories is raising concerns that the export sector could be hit hard, threatening to further undermine an economy as it struggles to recover from the pandemic’s crippling blow to the crucial tourism industry.

 

 

Reference: CNBC, Reuters, Trading View, FXStreet, ActionForex