Ichimoku analysis (8-hour)
Tenken-Sen- $1586
Kijun-Sen- $1579
Gold continues to trade higher and jumped more than $30 this week. According to China's National Health Commission, the total number of death increased by 114 to 2118 and the number of confirmed cases has declined a lot compared to the previous day. The spread of coronavirus is expected to impact global growth, and this will increase demand for safe-haven assets like gold. The yellow metal is holding above $1600 and is currently trading around $1609.
The US 10 year bond yield is trading flat after 3 days of decline till 1.534%. The spread between US 10- year and 2 years has narrowed to 13.9 bps from 27 bps.
The near term resistance is around $1611 (Jan 8th high), any convincing break above targets $1625/$1640. On the flip side, the immediate support is at $1591 (23.6% fib) and any breach will drag the gold underneath till $1578/$1555 likely. Extreme bearishness only under $1535.
It is good to buy on dips around $1580-81 with SL around $1570 for the TP of $1640.
