Gold’s Ascending Triangle Pattern Continues to Play – Trade Plan
What’s up, traders.
The precious metal GOLD prices closed at $1478.70 after placing a high of $1481.76 and a low of $1473.22. Overall the gold prices remained bullish throughout the day.
On Thursday, gold prices moved higher after the US House of Representatives voted to impeach President Donald Trump. This raised the fears of political uncertainty in the world’s largest economy and hence, safe-haven assets gained.
Donald Trump became the third US President to be impeached on the grounds of abuse of power by the Democratic-led House of Representatives. Another charge on him was the obstruction of Congress. During such time of political and financial uncertainty, traders tend to buy gold as an alternative investment.
According to ANZ analyst Daniel Hynes, “The impeachment is resulting in a slight increase of the uncertainties, and we see gold inch higher on the back of that. This news is also offsetting headwinds such as strong equity markets, the trade deal, and better economic data.”
However, the Republican-controlled Senate is widely expected not to convict and remove Donald Trump from his position by passing the impeachment. If they condemn him, which is unexpected, it would make the next year’s US election more uncertain.
Furthermore, the political uncertainty in Washington failed to move gold across the board. Gold prices held firm as investors awaited further developments on a phase-one trade deal of US & China.
On Thursday, China announced a new list of import tariff exemptions from the United States on chemical & oil products. Gold prices have gained 15% throughout the year from this 17-month long ongoing trade war between the biggest economies of the world.
Another factor including in the upward trend of gold prices on Thursday was the weaker than expected US macroeconomic data. At 18:30 GMT, the Current Account Balance for Q3 showed a decline of -124B against the expectations of -122B.
The Unemployment Claims for the last week also came in greater than expected and weighed on the US dollar. 234K claims were made last week for being jobless, and the expected were 225K.
At 20:00 GMT, the CB Leading Index also declined to 0.0% against the expectations of 0.1% and weighed on the US dollar. The Existing Home Sales also came in less than expected for the month of November as 5.35M against the expected 5.44M and weighed on the US dollar. The weaker than expected US macroeconomic data gave strength to gold prices on Thursday.
Daily Technical Levels
Support Resistance
1477.79 1486.29
1473.22 1490.22
1469.29 1494.79
Pivot Point: 1481.72
Gold’s choppy trading continues for another day, but recently gold is facing support around 1,477, which seems to give a hard time to gold bears. On the hourly chart, gold has formed a bullish engulfing candle above 1,477, which is likely to drive some bullish movement in gold, maybe up to 1,481.
Whereas, the bearish breakout of 1,477 can drive selling until 1,474.
Good luck for the day!
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