Morning Brief, Dec 30 – Gold’s Bullish Trend Continues, Watch Out for Trade Plan
Arslan Butt • 2 min read
Good morning, fellas.
[[GOLD]] prices closed at $1510.63 after placing a high of $1515.32 and a low of$1507.310. Overall the trend for gold remained unclear on Friday.
Gold remained steady on Friday as it closed at the same level it started its trading day with, i.e. $1510. However, gold remained bullish throughout the week amid thin volume of the holiday trade.
Concerns about global economic growth and trade deal between the two largest economies still prevail in the market and are supporting gold prices at the end of the year. Gold has risen 2% this week amid US-China trade deal uncertainties.
According to Cui Tiankai, China’s ambassador to the United States, Beijing would fulfill its side of the phase-one trade deal commitments, but in return, Washington must also honor the one-China policy and live up to its vows on issues like Taiwan.
China has accused the United States of interfering in internal matters of China, like in Hong Kong, Tibet, Xinjiang, and the self-ruled island of Taiwan, which has polls coming up on January 11, 2020.
Cui said that there was a need to make an apparent distinction. In Taiwan, a province of China, local elections would take place, and as far as the US was concerned, it has made commitments to one-China policy and should not interfere in Taiwan.
He added that China has only one land, and both Taiwan and the Chinese mainland were part of that. He said that the United States should not violate the sovereignty and territorial integrity of China.
However, on Tuesday, Donald Trump said that Chinese President Xi Jinping would meet him to sign the phase-one trade deal. In response, Chinese officials said that they were in very close contact with Washington to sign the agreement, but they did not confirm the meeting of both Presidents.
Signing the deal before the year-end seems to be unlikely as only two days are left for that, and there is no clear announcement of the date for signing from both sides.
Expectations of investors had increased after Donald Trump’s statement, but no confirmation from China has created doubts in the market.
These types of uncertainties have kept gold prices on an upward trend throughout the week to reach a level of $1515 per ounce. Traders are investing in a view that gold prices would surge further in the next year.
GOLD – XAU/USD – Daily Technical Levels
Pivot Point 1508.94
The precious metal gold continues to trade in line with the forecast and trades in between 1,510 to 1,514 resistance areas. The bullish bias in gold still remains strong as the MACD histograms stay above 0, and the RSI is holding in the overbought zone.
Sellers are looking to enter the market, but the appropriate level is needed. A slight bullish movement can be seen in gold until 1,516/17, and below this level, I will be happy to take a sell position. In any case, if 1,517 also gets violated, gold’s next stop will become 1,535.