Last Friday’s NFP was disappointing. The reaction of the markets was astonishing. Will it last longer? Let's find out the main trade opportunities for the upcoming week.
Gold: calm before the storm?
2020-05-06 • Updated
On one hand, the gold intraday range is broad, on the other hand, its week range is narrow. What’s the reason?
On April 6 XAU/USD dropped dramatically. The first reason is that most countries have started to ease their lockdowns and slowly reopen their economies, what gets the risk appetite up, though the number of coronavirus cases continues to rise. Another reason is the strong US dollar.
As we can see at the chart below the 50-period moving average crossed the 100-period moving average upside down, that was the signal to sell. The gold price fell below 1690, but it’s still above the 200-period moving average. The most probable scenario that it may touch the recent low on 1672, reverse and move up after the short pullback. We know from the past, when gold volatility falls but gold prices do not follow, it will lead to further rally up. The resistant line is 1705.
Institutional investors speak about further growth in the stock market. In the exact market that has doubled since COVID-19 and doesn’t plan to stop. Is it possible?
After an extremely volatile week in the markets, traders await the next steps of the USD and stocks. What drivers will move the assets next week? Lets’ find out!
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