Spot gold sits on the sidelines as the number of new coronavirus cases falls

February 13, 2020 - 2 weeks ago
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The precious yellow metal fluctuated in and out of losses and gains throughout the daily trading session yesterday and closed nearly flat at the New York close.

However, it remains above the support region of $1,558-62 after posting an intraday low of $1,561.

The coronavirus, known as Covid-19, has put the bulls on the sidelines as signs of a slowdown in the number of new cases.

China reported on Wednesday its lowest number of new coronavirus cases in two weeks, bolstering a forecast by Beijing’s senior medical adviser for the outbreak there to end by April, but United Nations health authorities warned it could still “go in any direction.”

The outbreak of the virus has now claimed 1,115 lives, with confirmed China cases resulting in 44,653.

Airlines have cancelled more than 85,000 China flights because of the outbreak, according to aviation consulting firm Cirium. That count is set to rise in the coming weeks as more than a dozen international airlines have scrapped or reduced China service altogether. The cancellations, logged between Jan. 23 through Feb. 11, account for more than a third of scheduled flights, too, from and within China, Cirium said. Close to 20% of international flights to and from China, or 9,239 trips were cancelled, and 37% or 76,338 flights were cancelled. The impact will likely dent airlines’ first-quarter results as they process refunds to customers booked on those routes.

Meanwhile, U.S. Federal Reserve chairman Jerome Powell wrapped up his semiannual economic report before congress, during which he reiterated that the central bank is closely monitoring the coronavirus and other threats.

On the technical front, due to the overnight’s breakdown, it is assessed we could see a revisit to $1,558-62 support, with $1,550-54 viewed beneath.

The resistance holds at $1,572-74 with $1,585 viewed above.

A clear surpass of this level should open space for the advance to take the contest to the seven-year highs of $1,600-15.

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