Gold Price Prediction – Prices Rise after WHO Declares Emergency

Gold prices attempted to move higher and break out following news that the World Health Organization said the coronavirus is a global health emergency. This is a rare designation that helps the international agency mobilize financial and political. The announcement comes just hours after the U.S. confirmed its first human-to-human transmission of the virus.

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Technical Analysis

 

Gold prices moved higher but opened where it closed forming a doji day which is a sign of indecision. Support is seen near the 20-day moving averaged at 1,561. Price action remains in a cup and saucer continuation pattern. This is generally a pause that refreshes higher. Medium-term momentum is negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the-red with a downward sloping trajectory which is points to lower prices.

The movement of the relative strength index (RSI) reflects consolidation as the oscillator moves sideways. Short term momentum is positive as the fast stochastic generated a crossover buy signal and continues to accelerate higher.

Coronavirus Continues to Drive Uncertainty

Since emerging less than a month ago in Wuhan, China, the coronavirus has infected more people than the 2003 SARS epidemic. The number of deaths continues to pile up and investors are wondering whether this will take its toll on global economic growth. The first human to human transmission of the coronavirus was reported in the US.