In the Asian session on Monday (October 26), spot gold continued to fluctuate around the 1900 level, while silver prices were on the defensive, with no major data released during the day.
At present, the market risk sentiment is not good, Asian stocks are under pressure to fall, the U.S. dollar to the safe-haven favor, the U.S. dollar index continued to rise near the 93 mark, which put pressure on the trend of gold.
Stocks in the Asia-Pacific region were mostly lower early Monday ona surge in novel Coronavirus cases in the U.S. and Europe.
More than 83,000 new cases were reported Friday and Saturday in sunbelt states after the outbreak, surpassing the record of about 77,300 recorded in July, according to Johns Hopkins University.
White House Chief of Staff Mark Meadows said Sunday that with a surge in new cases, the United States will not be able to contain the outbreak. Vice President Mike Pence’s chief of staff and three aides have tested positive for coronavirus, but his office says pence will not quarantine himself.
Cases are also surging in Europe, with France seeing record Numbers of coronavirus infections every day, while Italy ordered early closures of bars and public gyms to prevent a resurgence of the virus, According to Reuters.
This week is the last week of October and the last trading day until November 3.
“Based on what we have seen over the past two weeks, in our view, it would take some significant new news to drive the market sharply lower over the next week and a half,” Matt Maley, chief market strategist at Miller Tabak, said in a note Sunday.
Traders will be closely watching a slew of results from big technology companies and blue-chip stocks this week, as well as key economic data. Apple, Facebook, Alphabet, Amazon, Boeing and Caterpillar are all due to report later this week, and the first us GDP report for the third quarter is due on Thursday.
The Dow Jones industrial average and the S&P 500 fell for the first time in four weeks as negotiations continued over the next coronavirus stimulus package. U.S. Treasury Secretary Steven Mnuchin said Friday that House Speaker Nancy Pelosi is still wrangling over some issues in the aid agreement.
Ms Pelosi said Washington was reviewing its latest proposals for a new rescue package and expected to respond on Monday. She is optimistic that the two sides can reach an agreement. She wants the two sides to agree on a bail-out bill as soon as possible and, if not by November 3rd, then as soon as possible thereafter.
On the daily chart, the DOLLAR index remained firm, constantly approaching the 93 barrier. The daily chart MACD green momentum column weakened slightly, while the KDJ random index held steady above the oversold level, indicating that short-term bearish momentum is weakening and prices may stabilize.
On the 4-hour chart, the USD index remains in a narrow range, currently wrapped around its 20-period moving average. The MACD red momentum column is gradually expanding and the KDJ random index is trading around the 50 level, indicating a strengthening of dollar bullish momentum, short term or further higher.
On the daily chart, gold came under further pressure after two consecutive days of losses, falling to the 1900 level. The daily chart MACD red momentum column remains weak, with the KDJ stochastic trying to break below the 50 level, indicating weak bullish momentum for gold and currently prone to volatility.
In the 4-hour chart, gold has been testing new support, recently touching $1,891 to see if that level can be held. The MACD green momentum column is gradually expanding and the KDJ random indicator is holding steady above the oversold level, indicating that gold still faces downward pressure in the short term.
On daily charts, silver extended the momentum of the previous two days of volatility downward, constantly approaching the $24 mark. The daily MACD red column of momentum remains weak, with the KDJ random index holding steady above the 50 level, indicating that silver’s bullish momentum is still in short supply or further volatility.
On the 4-hour chart, silver’s earlier decline from $25.28 continued, briefly losing support from its 100-session moving average and looking to regain that level. The MACD green momentum column is gradually expanding and the KDJ random indicator is holding above the oversold level, indicating that bearish momentum is strengthening in silver and may move lower in the short term.
Fundamentals positive factors:
1.The number of confirmed coVID-19 cases in the United States continued to climb in the past two days, with 79,852 new cases reported on Saturday, edging closer to Friday’s record of 84,244, According to Reuters. — The rebound of the epidemic brings safety, which is good for gold.
2.U.S. House Of Representatives Speaker Nancy Pelosi said Thursday that negotiations with the Trump administration on a new financial rescue package have made progress and that legislation could be finalized “very soon.” — The prospect of a stimulus deal is good for gold.
- White House Chief of Staff Mark Meadows said Wednesday that the biggest sticking point in the novel Coronavirus agreement negotiations remains funding for state and local governments, but added that progress has been made toward an agreement. — THE U.S. stimulus is betting against the dollar.
Fundamentals negative factors:
- House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin traded accusations Friday that they should help move the talks forward. The chances of passing a stimulus bill before the election are fading fast. Pelosi said Trump should push negotiations and get Republicans to agree to any deal with the White House on a nearly $2 trillion aid package. Mr. Mnuchin, the White House negotiator, said significant progress had been made but accused Ms. Pelosi of stalling by refusing to compromise Democratic priorities. The stimulus bill has been slow to come to fruition.
- New claims for state unemployment benefits fell 55,000 last week to a seasonally adjusted 787,000, according to data released on Thursday, but the overall number remained relatively high. — Better-than-expected U.S. jobs data boosted the dollar and hurt gold.
- America’s new stimulus package is still stuck. Ms. Pelosi had set a deadline on Tuesday to negotiate a rescue package before next Month’s election in March but has so far conspicuously failed to reach a deal. — The lack of a deal has put a brake on gold’s rise.