International spot gold traded at $1,618.30 an ounce in Asian morning trading on Monday. Gold prices maintained the trend of consolidation shock, early shock fell to $1608.60 / oz, down more than $12 from the day’s high, then recovered from that point, and now continue to show a moderate recovery.
Gold rallied in the last session, rising for a third straight session, as dismal U.S. nonfarm payrolls data amplified the economic impact of COVID 19, but gains were capped by a stronger dollar.
Us employers shed 701,000 jobs in March, ending the longest streak of job growth in 113 months, a report said on Friday, as tough measures to contain an outbreak of novel coronavirus led to the closure of shops and factories and confirmed the economy had slipped into recession.
According to Fxstreet analyst Haresh Menghani, the march nonfarm report involved a period prior to March 12, when no major U.S. state had initiated a blockade, and the market reaction was fairly muted, with little meaningful impetus. The move comes after the job market was hit hard by the spread of the disease in the us. The United States lost 10 million jobs in two weeks, an unprecedented rate and scale.
Edward Moya, senior market analyst at broker OANDA, said gold remained in wait-and-see mode, waiting to see how badly the global economy would be hit and how long depression-like conditions would last.
“We believe gold is likely to continue to play an important role in investor allocations in the coming months given the current turmoil,” ED&F Man Capital Markets analyst Edward Meir said in a note. However, volatility will remain quite high.”
In terms of global epidemic, according to the latest statistics, the total number of confirmed covid-19 cases worldwide has exceeded 1.27 million, and the total number of deaths is close to 70,000. The cumulative number of confirmed COVID 19 cases in the us exceeded 330,000, still the highest in the world, and Germany became the fourth country with more than 100,000 confirmed cases.
Worldometers world real-time statistics show that as of 10:25 PM Beijing time on April 6, the United States COVID 19 cumulative confirmed cases of the world’s largest, more than 330,000 cases, 336,830 cases, 9,618 deaths.
New York state has more than 120,000 confirmed COVID 19 cases and more than 4,000 deaths, accounting for more than one-third of all COVID 19 cases and deaths in the United States. In addition to New York state, the number of confirmed cases in New Jersey rose rapidly to more than 37,000, with 917 deaths.
US President Donald trump said at a briefing on the outbreak on the evening of April 5 that the latest data showed that the government’s estimate of cumulative COVID 19 deaths may be on the high side. There will be a “scary level” of COVID 19 deaths in the us, but at that level things will start to get better.
If the global outbreak worsens and risk aversion rises, gold could see a bigger burst.
On the daily chart, the dollar index rebounded further from its lows, with the MACD green momentum column narrowing and the KDJ random index slightly tilted upward, indicating that the dollar rally momentum is still there and may continue to move upward.
On the 4-hour chart, the dollar index showed a modest rebound, the MACD red kinetic energy column unchanged, the KDJ random index moderate flat, indicating that the dollar may be caught in a short period of narrow consolidation trading.
On the daily chart, gold prices began to rebound, MACD red momentum column held steady, KDJ random index pressure downward, indicating that gold may temporarily hold the rebound.
On the 4-hour chart, gold prices show a narrow finishing trading, MACD red kinetic energy column slightly narrowed, KDJ random index pressure downward, indicating that gold may continue to narrow short range pressure.
fundamentals Positive factors:
- According to the latest statistics, the total number of confirmed covid-19 cases worldwide has exceeded 1.27 million, and the total number of deaths is close to 70,000. The cumulative number of confirmed COVID 19 cases in the us exceeded 330,000, still, the highest in the world, and Germany became the fourth country with more than 100,000 confirmed cases.
- British prime minister Boris Johnson, who has been quarantined for 10 days with a novel coronavirus, has arrived at a hospital for tests.
- A record 6.648 million people applied for unemployment benefits in the week ended March 28, the labor department said on Thursday. Economists expect another four to five million workers to file for unemployment benefits last week as the coronavirus-related shutdown spread across the country. Estimates are as high as 9 million.
- The institute for supply management’s manufacturing index fell below the 50.0 line of expansion and contraction in March on Wednesday. The ISM manufacturing index fell to 49.1 last month from 50.1 in February. The decline in economic activity was driven by a sharp drop in new orders and output, the data showed.
Fundamental negative factors:
- The queen’s speech: “Although we have faced challenges before, this one is different. This time we join all nations in the global effort to heal with advanced science and our sincere passion. We will succeed, and success will be ours.”
- April 1 the federal reserve reduced the likelihood of a dollar crunch by expanding the ability of dozens of foreign central Banks to obtain dollars during the novel coronavirus crisis, allowing them to swap their holdings of U.S. debt for overnight loans in dollars.
- The sell-off in global stock markets highlights the growing risk of an outbreak that shows little sign of abating, given mounting evidence of a sharp global economic downturn. The dollar’s status as a global reserve currency makes it a natural safe haven.
- Russia’s central bank said it would stop buying gold from April 1, without explaining why.