What lies ahead for gold?
As you must already know, the direction of Gold is mainly dependent on the Price action of DXY (US Dollar index). So first, we take a look at the US Dollar index.
GBP/USD: consolidation
2020-04-03 • Updated
Status: consolidation
Support: 1.2300
Resistance: 1.2455
Awesome Oscillator: at zero line
Storyline
What looks like a stopped heartbeat on the GBP/USD H4 is a consolidation of the currency pair with almost 0% fluctuation. Why suddenly?
First, the GBP was losing to the USD due to fueled demand of investors for the USD as a reserve currency. But then, in the second part of March, the reports started growing gloomier for the US. Donald Trump eventually changed the tone at his press conferences from optimistic to quite pessimistic, and +6.5mln applications for the unemployment benefits among the Americans made the US dollar tremble. At the same time, that disappointment did not hit as strong due to hopes on the US-President-suggested scenario for the OPEC+ to cut oil supply by 10mln per day on Thursday.
However, the GBP could not take advantage of none of that because the UK is in a dire situation itself. The Bank of England is pumping more currency into its economy and plans to keep doing so. Hence, both currencies got weaker, although due to a different set of factors.
What will it be next? In the short term, today’s NFP will show. In the long-term, the strength is still on the US dollar’s side.
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