Gold Price Rebounds but U.S. Political Turmoil Raises Caution
Illustration photo of Gold Price H4 Chart from dailyfx.com
Gold price rebounded to $1837 and pushed up to $1858 so there is still a market risk sentiment. The key driving factor is the political turmoil in the United States. The violent protests at the Capitol have escalated the difficulty of security deployment for President-elect Joe Biden’s inauguration and continue to create caution for gold buyers.
As of 08:48 (GMT+8) gold price has increased to $1858, up 0.16%.
U.S. President Trump has declared a state of emergency in Washington, D.C. until January 20 when incoming President Biden is sworn in. A statement by Yogananda Pittman, Acting Chief of the Capitol Police Department, said that no Americans will be allowed to enter the Capitol for the inauguration ceremony. The Federal Emergency Management Agency and the U.S. Department of Homeland Security will coordinate their efforts for disaster relief and have been authorized to provide equipment, resources and weapons as appropriate.
Security precautions have increased because of the attack on the Capitol by President Trump’s supporters on January 6. In addition to that, Trump’s impeachment is also a headline with Liz Cheney, the No. 3 Republican in the House of Representatives, announcing that she will vote for impeachment of the president.
Meanwhile, the Center of Disease Control (CDC) announced recently mandatory negative COVID-19 reports for all incoming pilots to the United States from January 26. It is also worth noting the Federal Reserve’s policymakers’ recent remarks regarding Biden’s expected larger fiscal stimulus package in the second half of the year. Vaccination optimism gives gold bulls positive outlook.
Limitations for the gold’s near-term trend are the 50-day moving average at $1866 and the 200-day moving average at $1842. The bearish Moving Average Convergence Divergence (MACD) will target the mid-December low of $1819.
FOLLOWME XAU/USD Overall Sentiment (As of 09:45 a.m., Jan 12, 2021)
Short - 50.23%
Long - 49.77%
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