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Gold Slides Lower as Markets Look Forward to US-China Trade Deal

Early on Tuesday, gold prices continue to weaken as the market sentiment rises on hopes of the upcoming US-China phase one trade deal due to be signed tomorrow. At the time of writing, GOLD is trading at a little above $1,540.

The risk-on sentiment is back in global markets, denting the safe haven appeal of gold and strengthening riskier assets. In addition to the upcoming trade deal signing, gold prices are also declining as tensions between the US and Iran recede and the possibility of a military conflict wane.

Ahead of the signing ceremony, stock markets are also rallying towards record highs while the US dollar has also made some gains. Gold shares a negative correlation with the dollar, and the strengthening of the greenback has also driven weakness in the precious metal’s prices lately.

Last week, gold had rallied to above $1,600 per ounce over fears of the US and Iran nearing a warlike situation after US drone strikes killed a top Iranian military commander. Iran had retaliated by launching missile attacks against Iraqi military bases where US troops were stationed, sending markets into a tizzy. However, the sentiment improved after both nations signaled that they were not interested in pursuing military conflict.

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Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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