- Summary:
- Gold price rose today as investors rushed to safety after Trump announced his coronavirus diagnosis. The nonfarm payrolls will be watched next
Gold price is up by more than 0.30% as investors continue to react to the latest Trump diagnosis news. The precious metal is one of the few assets that is in the green today and is a sign that investors are rushing to safety. The price of silver and copper are down by 0.35% and 0.80%, respectively.
In a tweet earlier today, Donald Trump said that he and Melania had contracted the coronavirus. As a result, the US dollar and the Japanese yen spiked while global equities dropped. The Dow Jones futures lost as much as 500 points. At some point, gold price was also in the red.
The price action by gold is mostly because of its role as a safe-haven. Passionate investors hold the metal because of its track record that spans centuries. They also hold it because of its characteristics as a hedge against risk and inflation. Today, investors are buying it because of its safe-haven qualities.
Gold price is also rising ahead of the nonfarm payroll numbers that will come out later today. Analysts expect the data will show that the unemployment rate dropped to 8.2% as the economy added more than 840,000 jobs. They also expect that the data will show that wages rose by 8.4%.
Recently, the US has released mixed economic numbers. Yesterday, the data showed that the initial jobless claims declined to a six-month low of 837k. Another data showed that consumer spending increased even as wages fell. On Wednesday, data from ADP showed that US private companies added more than 749k jobs.
Gold price technical outlook
The four-hour chart shows that gold price has been in a strong upward trend after it fell to $1,850 on September, 24. The price upward trend is supported by the ascending trendline that is shown in green and the 25-day exponential moving average.
Therefore, while this will be a volatile day, I suspect that the upward trend will remain as bulls aim for the 17th September low of $1,930 and then the September 21st high of $1,955.
On the flip side, a move below today’s low of $1890 will invalidate this trend. It will open the possibility that the price will move below $1,800.
Gold technical chart
