Gold prices continued to trend higher on Tuesday, hitting a fresh 8-year high and poised to continue its upward trend. The dollar whipsawed moving slightly lower, helping to buoy the yellow metal. Fear of the continued spread of COVID in the US and the world is helping to buoy the safe-haven status of gold.US yield moved higher but did not impact the upward trajectory of gold prices. US consumer confidence unexpectedly rose while the US Chicago PMI came in softer than expected.
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Gold prices moved higher and continued breaking out to fresh 8-year highs. Support is seen near the 10-day moving average at 1,756, and then the 50-day moving average at 1,725. Resistance is seen near the August 2012 highs at 1,791. Short term momentum has turned positive as the fast stochastic generated a crossover buy signal in overbought territory. The current reading on the fast stochastic is 92, above the overbought trigger level of 80 which could foreshadow a correction. Medium-term momentum remains positive as the MACD (moving average convergence divergence) histogram prints in the black with an upward sloping trajectory which points to higher prices.
Consumer Confidence Rebounds
Consumer confidence increased more than expected in June as restriction loosened for stay-at-home orders, raising hope for an economic recovery. The Conference Board’s consumer confidence index rose to 98.1 for the month. Expectations had been for consumer confidence to rise to 91 from a May reading of 85.9. The board’s present situation index rose to 86.2 from 68.4 while the short-term outlook among consumers also improved.
This article was originally posted on FX Empire
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