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Technical analysis of the price of gold today 28/8/2020

Between the resistance level of 1977 dollars per ounce and the level of support 1909 dollars per ounce, the performance of the gold price at the time the US Federal Reserve announced the adjustments to its monetary policy and in the words of Bank Governor Jerome Powell at the Jackson Hole seminar, which is still going on.

gold-price

 

The markets understand the announcement and its consequences returned by pressing the dollar and therefore the best opportunity for the price of an ounce of gold to rise to the level of resistance 1949 dollars at the time of writing. Rising tensions between the United States and China also contributed to the gold gains.

Gold price today 

Yesterday, Federal Reserve Chairman Jerome Powell announced a widely anticipated shift in price stability from the central bank's dual mandate. During a face-to-face speech at the Jackson Hole Economic Symposium, Powell said the Fed would change its approach to "a flexible form of average inflation targeting." The Fed chairman stressed that the long-term target is still an inflation rate of 2%, but that the inflation rate indicated would be lower if it fell below 2% after the economic downturn and never moved above that level even when the economy is strong.

Appropriate monetary policy is therefore likely to be aimed at moderate inflation above 2% after periods when inflation was falling below this level, Powell said.

In terms of economic news, pending home sales in the United States jumped much more than expected in July, the National Association of Realtors revealed in a special report. NAR said its outstanding home sales index rose 5.9% to 122.1% in July after rising 15.8% to 115.3 in June. Economists predicted a 3% increase in sales of pending homes. Sales of pending homes rose for the third consecutive month after falling in March and April and are now up 15.5% compared to the same month last year.

The Labor Department released a report showing a decline in claims for the first time for U.S. unemployment benefits in the week ending August 22. According to the report, initial unemployment claims fell to 1.006 million, down 98,000 from the previous week's revised level of 1.104 million. Economists had expected unemployment claims to drop to 1.000 million from the 1.106 million reported the previous week.

On another level. A Report from the Commerce Department showed that u.S. economic activity shrank slightly from what was initially expected in the second quarter, although it still shows a sharp decline in GDP. Real GDP slowed by 31.7% in the second quarter compared to 32.9% previously, according to the report. Economists had expected a revised decline in GDP to 32.5%. The lower-than-expected decline in GDP came as investment in private inventory and consumer spending declined less than previously expected.

According to the technical analysis of gold:

There is no change in my technical view of the price of gold as the general trend is still rising as long as it is stable above the resistance 1900 dollars. The bulls' eyes are still moving towards psychological and historical resistance of $2,000 per ounce, especially if the pressure on the dollar continues for longer. The nearest support levels for gold are currently 1938, 1925 and 1900 respectively. I still prefer to buy gold from every low level. It is the traditional safe haven for investors in times of uncertainty and global geopolitical tensions that still exist.

For today's economic diary data

All focus on u.S. session data, personal consumption expenditure price index, u.S. citizen's spending and income rate, reading the Chicago Purchasing Managers' Index and then Michigan's consumer confidence.