Gold Slipped Below 1,500 Mark – Risk-on Sentiment Plays
Arslan Butt • 1 min read
On Tuesday, the precious metal gold prices sank for a fourth straight session as the appetite for risky assets remained buoyed by backing for global stimulus and sentiments of potential developments in the Sino-US trade war.
As discussed in FX Leaders Sep.10 Morning Brief, China’s consumer price index (CPI) stood above trend in August, kindled by mounting food prices and weather-related stock deficiencies. The National Bureau of Statistics reported that China’s CPI rose 0.7% in August, up from 0.4% in July.
Stronger economic figures from China are supporting the risk-off sentiment, driving bullish trends in the stock market, and bearish trends in gold. Gold is down 0.6% at $1,490.10 per ounce, after hitting its lowest since Aug 13 at $1,486 earlier in the session.
GOLD – XAU/USD – Technical Outlook
Technically, gold has formed a Doji pattern on the 3-hour timeframe which is likely to extend its support around 1,487 level.
The RSI and Stochastics are holding in the oversold zone, suggesting chances of bullish reversal in the market.
Gold may retrace back upward until 1,498 and 1,504 levels if it manages to hold above 1,487 level. Otherwise, selling can be seen below the 1,486 level until 1,482.
Gold – XAU/USD – Technical Levels
Key Trading Level: 1504.09
Consider staying bearish below 1,504 and bullish above 1,487 level for a quick 40 pips target on both sides.