Gold stays strong , keeping an eye on 1,600 USD
Source: Economic Events 22 January 2020 - Admiral Markets' Forex Calendar
Over the past few days, Gold stabilised around the yearly highs of 1,550 USD. Chances therefore seem good that the precious metal will continue with its bullish trend in the days and weeks to come.
This is despite US inflation coming in at 2.3% year-on-year in December 2019 (its highest level since October 2018), and the latest Housing Starts numbers also coming in at their highest level since December 2006.
If today's Existing Home Sales do not follow the positive tendency of the Housing Starts, Gold could see the beginning of another push up to 1,600 USD.
This bias is also supported by Gold being about to enter another bullish seasonal window on Friday. After Silver, which is highly positive correlated to Gold, entered a bullish seasonal window last week on Monday, Gold enters one between the January 24 and February 4.
The seasonal bullish pattern developed over the last 20 years with Gold seeing an average gain of 23.50 USD for 15 of the past 20 years. In the remaining five years, it dropped on average only 11.73 USD, while the maximum loss of the pattern was 23.90 USD and the maximum drawdown being 26.05 USD.
Technically, Gold stays bullish on a daily time frame as long as we trade above 1,440/450 USD, with the potential next target on the upside being found in the region around 1,650/700 USD.
Please note: Past performance is not a reliable indicator of future results, or future performance.
In 2015, the value of Gold fell by 10.4%, in 2016 it increased by 8.1%, in 2017 it increased by 13.1%, in 2018, it fell by 1.6%, in 2019, it increased by 18.9%, meaning that after five years, it was up by 28%.
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