Fundamental view:
Gold futures settled sharply lower last week with most of the losses taking place in one session, while the rest of the week, the market attempted to claw back these losses. Pfizer and BioNTech reported a 90% efficacy rate in their COVID-19 vaccine candidate. While the results are preliminary, the outcome seems promising not only for these firms – but also for three other efforts using the mRNA approach.
Gold has been rising on hopes for additional fiscal stimulus, yet with prospects of returning back to normal, the urge for additional funds is weaker.
The major economic events deciding the movement of the pair in the next week are NY Fed Empire State Manufacturing Index at Nov 16, Retail Sales monthly report at Nov 17, Building Permits, EIA Crude Oil Stocks Change Nov 18, Initial Jobless Claims at Nov 19 for US, and G20 Meetings at Nov 20.
XAU/USD Weekly outlook:
Technical View:
Last week’s high was 0.27% higher than the previous week. Maintaining high at 1965.5 and low at 1850.5 showed a movement of 115 pips.
In the upcoming week we expect XAU/USD to show a bullish trend. The Instrument is trading below the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1950.5 may open a clean path towards 2015.6 and may take a way up to 2065.6. Should 1835.5 prove to be unreliable support, the XAUUSD may sink downwards 1785.4 and 1720.4 respectively. In H4 chart diamond pattern breakout favors prospects of a bullish trend. Also to be noted three white soldiers formation exerts the expectation of uptrend for the pair.
| Preference |
| Buy: 1890.5 target at 2005.1 and stop loss at 1830.9 |
| Alternate Scenario |
| Sell: 1830.9 target at 1725.5 and stop loss at 1890.5 |
