XAU/USD: Fundamental Analysis Report 02 March 2021

EnclaveFX Ltd
Mar 02, 2021

Current trend

Gold quotes are correcting downward, trading at $1,711 per ounce. The instrument is decreasing, moving opposite to the USD Index, which exceeded the psychological level of 91 points yesterday and is now trading at 91.240. The dynamic is developing after reports that the House of Representatives in the US Congress approved a $1.9 trillion bailout plan proposed by President Joe Biden. The market is currently not fully able to assess the consequences of such an injection of liquidity, so most investors prefer to wait for the situation to develop.

The next reason for the decline in quotations stems from the first. ETF GLD, which is the largest gold ETF, has reported significant capital outflows. According to the organization, since the beginning of the year, it amounted to 63.5 tons of metal, and over the past week, the outflow in cash exceeded $1.5 billion.

Support And Resistance

The quotes are moving within the global downward channel, reaching the global support line today. Despite the strength of the fundamental factors, the level is strong enough, and a reversal is possible soon. Technical indicators are in the sale state. Fast EMAs of the Alligator indicator are below the signal one, and the histogram of the AO oscillator is trading in the sell zone.

Resistance Levels: 1765.0, 1890.0.

Support Levels: 1680.0, 1600.0.

Trading Tips

After a reversal and growth or consolidation above the local resistance of 1765.0, buy positions with the target at 1890.0 will be relevant. Stop loss is 1700.0. Implementation period: 7 days or more. After corrective decline or consolidation below the channel support line of 1680.0, sell positions with the target at 1600.0 will be relevant. Stop loss is 1740.0.


Timeframe: Weekly

Recommendation: Buy Stop

Entry Point: 1765.0

Take Profit: 1890.0

Stop Loss: 1700.0

Key Levels: 1600.0, 1680.0, 1765.0, 1890.0

Alternative Scenario

Timeframe: Weekly

Recommendation: Sell Stop

Entry Point: 1680.0

Take Profit: 1600.0

Stop Loss: 1740.0

Key Levels: 1600.0, 1680.0, 1765.0, 1890.0


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