In the Asian session on Tuesday (October 27), the DOLLAR fell short of the 93 marks, while spot gold took the opportunity to rebound to hit $1,910, silver also edged up.
“Gold has been stuck between $1,930 and $1,880. The market is waiting for guidance from the general election and the epidemic has picked up again, “said Phillip Streible, chief market strategist at Blue Line Futures.
The number of new cases in the U.S. hit a record high on the day, weighing on investor risk sentiment. In Europe, Italy and Spain imposed new restrictions.
For now, there is no major new news coming out of the market. China’s industrial profits remained firm in September, though not growing as fast as in August, according to the latest figures.
A surge in coronavirus cases sent Wall Street sharply lower yesterday and threatened to dampen investor sentiment in the Asia-Pacific region. Optimism that the White House and Democrats will strike a stimulus deal before the election is also waning.
Senate Majority Leader Mitch McConnell has adjourned the Senate until November 9. In other words, it is clear that no coronavirus economic relief package will be passed before the election.
Nor is there much hope of passing a stimulus, because Mr. McConnell’s Republican party in the Senate has been adamantly opposed to any further stimulus sought by Democrats and Mr. Trump, and he may never be on the same side.
The senators are now flying back to their states for the final week of campaigning. So all talk of a pre-election deal can now finally be put to rest.
Investors are also staying highly cautious as the US election looms. The CBOE Market Volatility index.VIX, known as Wall Street’s fear gauge, hit its highest level in more than seven weeks as uncertainty mounted over the November 3 election. Trump and Democratic candidate Joe Biden entered the final week of the campaign with a record number of about 60 million Americans voting early.
According to the latest news, Mr. Trump’s tweet about the postal ballot has been banned from Twitter. In his latest tweet, Mr. Trump said there was a big problem with mail-in ballots across the US.
But Twitter again suggested that the President’s comments were inappropriate, saying his comments were “controversial and could mislead about how to participate in elections or other civic processes.”
Some analysts suggest that Mr Trump’s narrowing options for victory could prompt him to take the fallback position of refusing to accept the election results. Markets are also preparing for that possibility.
Daily chart, the dollar index on the day under slight pressure down, lost 93 mark. 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 has formed a moving low, with an eye on whether the previous high of 93.13 can be broken. The MACD red momentum column started to weaken slightly, with the KDJ random index trading below overbought levels, indicating that dollar bullish momentum is starting to run out of steam, short term or lower.
On the daily chart, gold is trading above the 1900 level as it tries to stabilize after three straight days of losses. The daily chart MACD red momentum column remains weak, with the KDJ random index holding steady near the 50 level, indicating that gold bullish momentum is not strong and is currently prone to volatility.
On the four-hour chart, gold has rallied from its recent low of $1,891 and is testing its key 200-day moving average of $1,910. MACD red kinetic energy column initially appeared, KDJ random index rebounded above the 50 level, indicating that there is room for further gains in the short term gold.
On the daily chart, silver was trading around 24.50 as it tried to stabilize after three straight days of losses. 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.
In the 4-hour chart, silver has rebounded from a low of $24.07, with strong resistance above its 200-day moving average. MACD green momentum column gradually weakened, KDJ random index rebounded upward near the 50 level, indicating silver bearish momentum weakened, short term or further higher.
Fundamentals positive factors:
- The outbreak showed signs of worsening in Europe and the US, with the US, Russia and France recording a record number of new cases in a single day. The number of corona-related hospitalizations in the US jumped to its highest level in two months. — A worsening epidemic will trigger risk aversion, which is good for gold.
- 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.
- 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.
Fundamentals negative factors:
1.Mitch McConnell, us Senate majority leader, has adjourned the Senate until November 9 as the chances of the White House and Democrats reaching an agreement on a new bail-out package before the election look slim. A stimulus package is almost impossible to come by before the election, which is bad for gold.
2.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.
3.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.