In the Asian session on Monday (October 12), spot gold as a whole maintained the decline, although the day at one point hit the 1930 threshold, the rise quickly retreated, the price is now hovering around 1920. Silver has stayed above $25.
In the United States, Monday is Colombia Day. Bond markets are closed, but stocks are as usual. Markets continued to focus this week on the White House’s negotiations with Democrats over a bail-out package.
Democrats and Republicans in Congress opposed a $1.8 trillion new economic stimulus package proposed by the Trump administration on Saturday, with Democratic House Speaker Nancy Pelosi saying it did not adequately fund health resources such as virus tracking and detection.
Pelosi said on Saturday that a $1.8 trillion economic stimulus plan proposed by the Trump administration was “one step forward, two steps back” and would need to be revised to gain the support of Congressional Democrats.
The New White House proposal is higher than Mr. Mnuchin’s earlier $1.6 trillion offer and closer to the $2.2 trillion approved by the Democratic-controlled House of Representatives last week.
In an interview with FOX News, Mr Trump said that although Republicans had scaled up the rescue package because they wanted immediate help for the airline, restaurant and hotel industries, Ms Pelosi had blocked the arrangement.
White House economic adviser Larry Kudlow says a fiscal stimulus is not necessary for the US economy to recover from the epidemic, but that the Trump administration and Congressional Democrats will continue to negotiate on a stimulus package.
“No, I don’t think the negotiations are dead,” Kudlow said on Sunday. I would say that some targeted assistance programs would go a long way toward helping the economy.”
As well as the bail-out package, the markets are watching the US election. In an Interview with Fox News on October 11, Mr Trump said he no longer had COVID-19, that he was now “immune” to the disease and was not at risk of transmission.
“Yes, not only that, but it seems like I’m immune, so I can get out of the basement and I’ll still do it,” Trump said.
The White House has not confirmed that Mr Trump has tested negative for the virus. Fox News points to evidence that even mild COVID-19 patients are unlikely to be re-infected for at least three months. But it’s not clear how long that will last.
“The President is in great shape to fight this battle,” Trump added. I defeated this crazy, scary Chinese virus… I passed the highest tests, the highest standards, and I’m in good health. I have to tell you, I feel great. I feel really good.”
Mr Trump also defended his performance in the early days of the COVID-19 epidemic, noting that he had initially been criticised for banning Chinese travellers in January.
Mr Trump again criticised China, saying: “This [the outbreak] should never have happened. It’s China’s fault.”
On daily charts, the DOLLAR index is hovering around the 93 mark after falling sharply on Friday. The daily MACD green momentum column gradually expanded, with the KDJ stochastic hitting oversold levels below, indicating stronger short-term bearish momentum, but the decline may slow.
On the 4-hour chart, the DOLLAR index hit a low of 92.99, extending its previous downward momentum. The focus is now on whether this low can be a short-term support. The MACD green momentum column gradually contracted, with the KDJ random index trading within oversold levels, indicating that dollar bearish momentum is starting to slow and may be trying to stabilize in the short term.
On daily charts, gold is trading around that level after surging briefly past the 1930 mark on Friday. The daily chart MACD red kinetic energy column is gradually expanding and the KDJ stochastic index is approaching the overbought level, indicating that the bullish momentum for gold has begun to strengthen and there is still room for further gains.
In the 4-hour chart, gold’s previous surge broke through the key 200-day moving average of $1,922. Watch to see if this level can be held. The MACD red momentum column started to contract and the KDJ random index hit an overbought level upwards, indicating that bullish momentum for gold began to slow and short-term caution against overbought triggering a correction.
On daily charts, silver was trading around $25.30 after rallying 5 percent on Friday. The daily MACD red momentum column is gradually expanding, with the KDJ stochastic hitting an overbought level, indicating that silver’s bullish momentum is strengthening and prices may move higher in further volatility.
In the 4-hour chart, silver continues to rise above the key $25 barrier, with a short-term strong resistance above its 200-day moving average of 25.63. The MACD red momentum column gradually expanded and the KDJ random index hit the overbought level, indicating that silver bullish momentum strengthened and short-term caution for a pullback.
Fundamentals positive factors:
- Novel Coronavirus was once again referred to by Trump as a “China virus”. “The President is in great shape,” he said. “I’ve beaten this crazy, scary Chinese virus, I’ve passed the highest standards of testing, and I’m in good health. I have to tell you, I feel great.”
- On Friday, U.S. President Donald Trump gave the global risk market a jolt with the novel Coronavirus Stimulus plan ($1.8 trillion).
- House Speaker Nancy Pelosi and Mnuchin had a 40-minute conversation on the stimulus plan today, focused on the possibility of reaching a deal on a comprehensive bill, with Mnuchin making clear Trump’s interest in reaching a deal, according to House Speaker Drew Hammill’s spokesman.
Fundamentals negative factors:
- On Saturday, Democrats and Republicans in Congress opposed a new $1.8 trillion economic stimulus package proposed by the Trump administration, with Democratic House Speaker Nancy Pelosi saying it did not adequately fund health resources such as virus tracking and detection.
- The U.S. Labor Department said new claims for unemployment benefits fell 9,000 to 840,000 in the week ended October 3, compared with market expectations of 820,000.
- After announcing on Wednesday that coVID-19 drugs were “freely available,” Trump highlighted the issue again in his video on Thursday and gave more details. Trump said he wants to sign an emergency license for coVID-19 “immediately.” The FDA is moving faster than ever, and what would take the FDA one to three years could now be done in weeks or less.