GOLD Analysis – December 27, 2021

Gold’s Daily Price Analysis

Gold began the day with a modest increase, moving above the $1800 barrier despite a minor decrease in the US Treasury Yield. As a result, market participants have not fully recovered from the holidays, resulting in sluggish market momentum.

The US Dollar Index, which gauges the dollar's value against a basket of a half-dozen currencies from significant nations, was also rising, if slowly, and held over the 96.10 level. US Treasury yields were under pressure and hovered around 1.48 percent, assisting gold to start the day in the green. No macroeconomic statistics will be issued from the United States on Monday on the data front. However, the release of the Housing Price Index and the Richmond Manufacturing Index on Tuesday could impact the US dollar.

Last Monday, experts from the Walter Reed Army Institute of Research stated that they expect to reveal the development of a vaccine effective against COVID-19 and all of its variants, including Omicron and prior SARS-origin viruses that have killed millions of people. The vaccine was created after two years of research on the virus. The vaccine has yet to go through phase 2 and phase 3 trials, and identifying unvaccinated and uninfected patients has been difficult, causing the vaccine's completion to be delayed. However, if the vaccination is shown to be effective against all versions, the COVID-19 myth will be put to rest once and for all. This market confidence increased risk appetite and capped gold gains for the session.

On the other hand, gold was gaining strength as a result of the coronavirus's rapid spread. According to Johns Hopkins University, the global coronavirus caseload reached 279.9 million, with 5.39 million deaths and almost 8.94 billion people vaccinated. Over the Christmas holiday, commercial airlines globally canceled around 5,700 flights due to the spread of Omicron. France reported 100,000 daily COVID-19 cases for the third day in a row, and Portugal reported 10,000 daily COVID-19 cases.

Despite the city of Xi'an being under lockdown, China reported the greatest number of infections in four months. The rising number of coronavirus cases and the government's anti-coronavirus measures added uncertainty to the market, which supported precious metals on Monday morning.

GOLD Intraday Technical Level

Support Resistance

1806.65 1810.05

1805.10 1811.90

1803.25 1813.45

Pivot Point: 1808.50

GOLD - Technical Outlook 

On Monday, the yellow metal gold is trading sideways as most of the markets are closed amid holidays. Gold has gained support at the 1,808 level, surged from 1,798 pivot point level. On the 4-hour timeframe, gold has closed bullish engulfing candles supporting weakness in the bearish bias. Therefore, the closing of candles above the 1,808 pivot point keeps gold underpinned. Gold’s major hurdle stays at 1,810, and above this, prices will be exposed towards the next resistance level of 1,817 and 1,829. Further on the higher side, the resistance stays at 1,836. Gold’s immediate support stays at 1,805 levels. At the same time, a break below the 1,805 support might expose the gold price down to 1,789 or 1,777 level. The RSI and Stoch are signaling a uptrend in gold. All the best!