Daily Brief, Dec 23: Everything You Need to Know to Trade Gold  - Forex News by FX Leaders

Daily Brief, Dec 23: Everything You Need to Know to Trade Gold

Posted Monday, December 23, 2019 by
Arslan Butt • 2 min read

Good morning, traders.

Gold prices closed at $1477.98 after placing a high of $1480.97 and a low of $1475.78. Overall the movement of gold prices remained bearish throughout the day.

Gold prices dropped on Friday, but not much, on the back of increased consumer sentiment and personal income. The rise in Consumer Sentiment by the University of Michigan was back to the level it was before the US-China trade war, which unleashed a load of negativity on the global economy and markets.

At 20:00 GMT, the Core PCE Price Index for November came in as expected, 0.1%. Personal spending from the United States for November also came in as expected at +0.4%. However, the Personal income for November showed a gain of 0.5% in the month of November from the expectations of 0.3% and gave strength to the US dollar.

The Revised UoM Consumer Sentiment was released by the University of Michigan and came a little more than expected as 99.3 against forecasted 99.2. The Inflation Expectations for December by the University of Michigan was dropped to 2.3% in comparison to November’s 2.4%.

President Donald Trump said that the United States and China would sign their phase-one deal very shortly. He said that they have achieved a breakthrough in the trade deal and will be signing it soon.

The phase-one deal was announced this month to overcome the losses of an ongoing trade war for 17 months between the two largest economies, which has destroyed the global economic conditions and has affected the world’s market.

In the Phase-one deal, it was decided that the United States would reduce some tariffs on Chinese products in exchange for a massive purchase of American farm goods by Chinese companies. There have been doubts in the trader’s mind that whether the deal will be signed by China as it has expressed concerns about the huge amount of US farm purchases demanded by Donald Trump.

On the other hand, the drop in gold prices on Friday was reduced by the investors who were staying in GOLD because of political concerns over Trump’s impeachment trial.

On Wednesday, the Democrats who control the House of Representatives found Donald Trump guilty of abuse of power and obstruction of Congress. The decision was given after investigations concluded that he invited foreign meddling in the US electoral process. Democrats voted against Trump and made him the third president in the United States to be impeached by rivals.

However, the President will have to face trial in the US Senate, which is controlled by members of his Republican party. So, the chances of Trump being removed from office are unlikely because Republicans have made it clear that they view this impeachment as fake.

Gold – XAU/USD – Technical Levels
Support Resistance
1475.75 1481.03
1473.15 1483.71
1467.87 1488.99
Key Trading Level: 1478.43

Gold has a bullish crossover of 1,480 resistance level; with this, the market can lead to gold prices towards 1,492 targets. On the lower side, gold’s support continues to stay around 1,480 level. The RSI and MACD are still supporting a bullish bias today.

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About the author

Arslan Butt // Index & Commodity Analyst
Arslan Butt is our Lead Commodities and Indices Analyst. Arslan is a professional market analyst and day trader. He holds an MBA in Behavioral Finance and is working towards his Ph.D. Before joining FX Leaders Arslan served as a senior analyst in a major brokerage firm. Arslan is also an experienced instructor and public speaker.
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