Gold is struggling at 1900; can it fight back? (With Trading strategy)

Gold prices inched lower on Friday, at 11:30(GMT+8), the spot gold fell .0.9% to $1906.4 per ounce.

Gold prices rose to $1900 after U.S. President Donald Trump reignited hopes of a coronavirus stimulus package before the Nov. 3 elections, but a strong dollar kept the metal's gains in check.

Trump said he would agree to go higher than the $1.8 trillion that the White House has offered in coronavirus stimulus to strike a deal.

Europe's struggle with the rise in COVID-19 cases and ongoing talks over Brexit worked to boost safe-haven demand for gold.

Gold has moved in line with the dollar's strength absent other catalysts of late, but some longer-term investors believe that a resurgence of the pandemic and the belief that the viral outbreak may lead to further global fiscal stimulus has been considered a boon for bullion.

"Ultimately, gold will benefit as Europe unleashes more stimulus and as investors grow comfortable with a slight pause in aid from Washington DC," wrote Edward Moya, senior market analyst at Oanda, in a note.

Right now, the focus will continue to be on the election. 

 "What is happening in gold is we've had a stimulus-on/stimulus-off style news flow. This has whipsawed a lot of gold traders," TD Securities commodity strategist Daniel Ghali explained.

 "Election countdown mode is here, so the next 20 days will mostly revolve around that… With both the Trump and Biden agendas estimated to cost between $5 trillion and $5.6 trillion over the next decade, both plans would provide substantial tailwinds for the long gold trade." 

TD Securities believes the gold price is estimated to rise to $2,100 next year.

The investors might pay attention to the U.S. Retail Sales tonight. It is also called "horrible data" because the markets always react so violently after it is released.

Trading Strategy (source: Trading Central)

Pivot: 1897.00

Our preference: long positions above 1897.00 with targets at 1913.00 & 1925.00 in extension.

Alternative scenario: below 1897.00 look for further downside with 1889.00 & 1882.00 as targets.

Comment: the RSI is bullish and calls for further advance.

Supports and resistances:

1933.00

1925.00

1913.00

1907.00 Last

1897.00

1889.00

1882.00

Guideline for Trading Central strategy 

Trend chart reading guideline

1. First look at the time period in the upper left corner of the chart: ·30MIN and 1H chart shows the trading suggestions for intraday ·Daily chart shows the market trend analysis in next 2-3 days

2. The blue horizontal line on the chart marks the pivot: pivot indicates the reversal of the market. When the price is above the pivot, it indicates an upward trend, when the price is below the pivot , it indicates a downward trend. When the price breaks through the pivot, the trend is reversed.

3. The red and blue thin curves in the Candlestick chart chart are technical indicators: Red line is MA20+Bollinger bands, Blue line is MA50. under the Candlestick chart chart are also the technical indicators: Blue line is RSI, Red line is 9MA;

4. The green horizontal line is the resistance level for a price increase, and is also the profit target for long orders; the red horizontal line is the support level for a price decrease, and is also the profit target for short orders.

How to use TC strategy？

1.[Pivot] is the reversal line of the market trend. When the price up the pivot line which means in Bullish, you can open a long position or Buy. on the contrary, when the price under pivot line which means in bearish. You ‘d better make short positions or Sell. 

2. [our preference] is the main trading suggestion for your reference. You can exit your trading refer to this target or close positions before it.

3. [Alternative scenario] is the plan B for your reference. 

4. [Comment] is the technical analysis of market trends and technical support for trading strategies. 

5. [Supports and resistance] Supports are levels where the price tend to find support as it falls.

Resistances are levels where the price tend to find resistance as it rises. So, exit before the trend reverse.