After months of discussion, the novel coronavirus fiscal stimulus bill of the United States was finally passed this week and waited for the final signature of US President Joe Biden. Although this proved to be the most optimistic development recently, bulls' attention to the news slowed significantly and had already been priced.
Biden's speech will be key to U.S. unemployment claims, and the latest bill covers an extension of $300 a week in unemployment benefits, making millions of people eligible for unemployment insurance until Sept. 6. The bill pays $1400 directly to most Americans and their families, and when personal income reaches $75000, the amount of checks will begin to be phased out, while those earning up to $80, 000 will be limited.
The U. S. stimulus bill will provide $350 billion in relief to state, local and tribal governments, as well as $120 billion in Kmuri 12 schools. The bill also includes expanded subsidies and other provisions designed to help Americans afford health insurance. But the bill was passed without a Republican vote, and Republicans believe that the job market has recovered enough to require little or no new stimulus spending. Democrats also approved the plan themselves through a special budget settlement process in the House of Representatives.
Also in favor of gold bulls is the yield on 10-year treasury bonds, which fell for the second day in a row and recently fell two basis points to 1.52 per cent. This is because US bond auctions are not comparable to market prices, and the US stimulus bill increases investor risk-taking sentiment. Biden is also planning to propose about $2.5 trillion in infrastructure spending in April, which has also boosted risk-taking sentiment.
According to the labor department, the overall consumer price index ((CPI)) rose 0.4% in February, a moderate increase in line with economists' expectations and easing market concerns about inflation. The national consumer price index ((CPI)) fell 0.2 per cent year-on-year in February, a better-than-expected 0.3 per cent decline, according to the National Bureau of Statistics. In the first two months of this year, CPI fell 0.3 per cent year-on-year. The producer price index (PPI) rose 1.7 per cent year-on-year, better than the 1.5 per cent increase expected by the market.
But investors need to be particularly cautious because Asian markets appear to lack key data or important financial events in the short term. Therefore, before Biden makes a speech on novel coronavirus's fiscal stimulus bill, he should pay close attention to the ECB's interest rate decision, ECB President Christine Lagarde's speech and US unemployment application data.
The daily volatility chart of gold shows that the main trend is declining. A deal above $1673.30 would mark a return to the downward trend. When trading at $1815.20, the main trend will change. The market is now trying to build support on the strong side of the long-term Fibonacci level ($1711.70).
If gold can hold $1711.70 at Fibonacci levels in April, it will be looking for $1793.90 to reach a small high. Gold prices range from $1815.20 to $1673.30 in the short term, with the first upside target of $1744.30 at the 50 per cent level.
