GOLD has been finding resistance at the 200 SMA (purple) on the H4 chart recently, but yesterday in the European session it broke above that moving average as traders leaned on safe havens before the UK election results. That moving average turned into support immediately after that.

But, the sentiment improved in financial markets after the Conservatives won by a comfortable margin and after Donald Trump announced that he signed off the Phase One deal with China. The situation reversed immediately and safe havens got dumped off quite aggressively, as it usually happens during such periods.

USD/JPY surged higher, while Gold lost more than $25 as sellers piled in. But, it has been finding support at the 100 SMA (green) since then and earlier today we saw Gold bounce higher from that moving average. The reason for that is the silence from China regarding the trade deal. This has increased the uncertainty, whether China will accept the deal or not. They will probably will do so, but the silence is tense right now, so Gold is bullish at the moment.

Although, the moment that China will confirm the deal, then the downtrend will resume and the decline is going to be pretty ferocious, so watch out. If we can get a trade then, we will get in, but we will have to be very fast. Anyway, let’s wait for China’s confirmation though.