Gold Standstill Below $1,510 High, Sino-US Trade Dispute Underpins
On Friday, the precious metal gold prices trade sideways near $1,500 pivot, en route to its best week since April 2016. If you have been following us, you should have an idea that most of the bullish trend is caused by the escalation in the Sino-US trade dispute and fears of a global economic slowdown which have triggered fresh interest for safe-haven assets. US trade war drives China’s producer prices into deflation, even as pork prices send consumer inflation higher.
A day before, the Chicago Fed President Charles Evans once again hit the dollar, causing a slight sell-off. Bears jumped in the market after he signaled that he was open to lowering rates to support inflation and to counter risks to economic growth. The weaker dollar also triggered buying in gold.
GOLD – XAU/USD – Technical Outlook
Gold is stuck in the overbought zone, and investors are looking for a correction before they continue buying again.
Stochastics and RSI are holding in the overbought zone, and these may trigger further bearish retracement in gold today.
The Fibonacci indicator is supporting gold around 1,498 and 1,490 (23.6% & 38.2%) levels.
XAU/USD – Technical Levels
Support Resistance
1484.95 1514.16
1468.54 1526.96
1439.33 1556.17
Key Trading Level: 1497.75
Gold – XAU/USD – Trade Plan
Fellas, I’m not expecting trend continuation in gold, therefore, the idea will be to stay bearish below 1,510 and bullish above 1,492.
Good luck!
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