Daily Market Recap -GOLD Weekly Forecast

Gold prices recovered slightly towards the end of last week, finding support around the 1,860 per ounce handle as markets attempted to claw back some losses from Monday. The metal has fallen over 3 percent over the past 5 sessions.

Gold bulls were in for a surprise last Monday after news broke that Pfizer has found a vaccine that is 90% effective based on initial trial results. The immediate reaction in markets was that of increased risk-taking in higher-yielding assets and optimism that the economy may fully recover earlier than expected thanks to this vaccine.

However, optimism turned around after the mid-week mark following reports by the World Health Organisation that the recent wave of covid-19 infections in Europe and the US is reaching record highs. Several US states have recorded more than 100 percent increases in cases as more and more EU nations contemplate further lockdown measures.

Looking at the fundamentals, gold remains an attractive hedge against the massive amounts of stimulus funds already in the market with additional packages on the way. Fiat currencies will continue to devalue faced with an influx in liquidity, consequently increasing golds appeal and underpinning prices.

From a technical perspective, gold prices look set to continue its sideways range-bound pattern between the 1,913 and 1,860 levels. Consolidation around the 1,882 level could be an interesting move. Overall buying into dips will likely be the best strategy under these market conditions with a 10-15$ target price movement.

(Chart Source: Tradingview 15.11.2020)

Gold bulls should watch out for the 20-day MA coming just ahead which should prove the first hurdle for any potential test of the 1,900 pivotal points. On the downside, the immediate support channel should fall around the 0.382 Fibonacci retracement level at 1,875.

Support & resistance levels:

R3 1,935.00

R2 1,913.22

R1 1,895.00

S1 1,875.93

S2 1,861.77

S3 1,817.58

Disclaimer: This material has been created for information purposes only. All views expressed in this document are my own and do not necessarily represent the opinions of any entity.