Corona Virus impact on gold & stock market
Dow Jones ( DJIA ) Index tested 18900 levels this week after a high of nearly 30000 this year. This makes total correction of more than 30% in less than 2 months. Gold also crashed from 1700$ to 1450$. Dollar Index was also in free fall mode in first 2 weeks of march. Dollar recently started to surge and made high above 100.
Corona virus impact on US economy is very severe as Fed reduced interest rate from 2.5% to 0 in less than a month. Additional $1 trillion stimulus package also announced for market. ECB also announced $500 billion package for European markets to reduce the impact of virus on economy. Canada also announced measure to tackle the impact and offering rents, taxes discount for 1-2 months.
Currently we are in stage 2 of pandemic in most of the countries and if virus advances in stage 3 then we will have even more problem. Stage 2 caused nearly 30% correction in world market. Stage 3 will create havoc in entire world. Italy is fighting with stage 3 epidemic. Its also in lockdown. Many countries announced lockdown to control the virus impact on economies & their people.
Crude oil also tested new 18 year low when market crashed below 21$ this week. Saudi & Russian oil war with corona virus impact on economy is bankrupting oil companies slowly. Many oil companies in US started feeling the heat. President Trump announced last night he will be interfering in oil war between Saudi & Russia. Which gave much needed 20% respite to crude oil prices.
Currently gold price is trading at 1504$. Good support in xauusd chart stands at 1481$. If trader breaks and sustain below 1481$. Then expect more pressure in gold till 1470$- 1460$.
Good resistance in gold chart stands at 1521$. If trader break and sustain above 1521$. Then expect good rise in gold till 1540$- 1560$ and even more recovery in gold not ruled out.
Conclusion: Covid-19 virus impact is clearly seen on markets around the world. Stay cautious and trade with extremely tight stop loss. Current range of market is too big to trade for retail traders. However our gold signals package already delivered nearly $2500 profit per lot in this March so far. You can join my gold signals package. Just Whatsapp at +91-9920315014 for details
You can also check my daily updates on gold & crude oil on my youtube channel here