FxWirePro: Gold downside capped by 20- day MA, good to buy on dips

Ichimoku Analysis (Daily Chart)

Tenken-Sen- $1694

Kijun-Sen- $1599

 Gold has shown a minor recovery after hitting a low of $1661 yesterday. The slight decline in the global stock market due to coronavirus is supporting yellow metal at lower levels. The major factors to be watched are

Coronavirus

The total number of people infected due to coronavirus rose to 2557857 with the U.S is in the top with 819175 and four major European economies like Spain, Italy, Germany, and France at 204178,183957, 158050 and 148453.

US Market:

US stocks especially Dow Jones and S&P500 decreased more than 3% yesterday on declining oil prices.

Bond Yield

US 10-year yield is trading weak for the past 9 days and declined more than 35%. The spread between US-2 and 10-year narrowed to 32bps from 72 bps. 

Technicals:

On the flip side, near term support is at $1650 (21- day MA) and any violation beneath will drag the yellow metal down till $1618/$1600.

The immediate resistance is around $1700, any indicative break beyond targets $1725/$1740.

It is good to buy on dips around $1670 with SL around $1650 for the TP of $1740.