FxWirePro: Gold recovers on Safe-haven demand, break above $1625 targets $1660

Ichimoku Analysis (4-hour chart)

Tenken-Sen- $1596

Kijun-Sen- $1602

Gold has shown a nice recovery of more than $40 from $1572 yesterday.  But strength in the US dollar despite weak jobless claims is putting pressure on the yellow metal. U.S jobless claim rose to 6.6m.compard to estimate of 3.6m. US dollar index crossed 100 level yesterday from low of 98.27, any violation above 100.50 targets 101/102.

The number of infected cases due to coronavirus is at 1 million, while several deaths in the U.S crossed 6000. The chance of a recession in the coming months will increase demand for Safe-haven assets like the gold, yen.

 US 10-year yield is trading weak for 10th consecutive days and lost more than 50% from a high of 1.2763%. The spread between US 10-year and 2-year has narrowed to 36.8 bps from 70 bps.

Technically, near term support is around $1570 and any violation below will drag the gold down till $1545/$1500.

On the higher side, immediate resistance is around $1625 and indicative break above will take the gold till$1645/$1660.

It is good to buy on dips around $1575-80 with SL around $1560 for the TP of $1645.