Gold Stays Sold
Gold prices are starting the week on a softer footing, picking up where they left off last week on the back of the pullback we’ve seen from recent record highs. Optimism around a potential scaling back of US/China trade tariffs has weakened safe-haven support over the last week, seeing gold futures slipping from highs.
Trump & China
Positive comments from Trump last week regarding the likelihood of China tariffs coming down from elevated levels, followed by news that China was reportedly considering some US tariff exemptions, is feeding into better risk sentiment for now. Looking ahead this week, any further positive headlines should drive a fresh leg higher in risk appetite weighing on gold prices near-term. On the other hand, if we see any deterioration in the tone from either side, gold prices are vulnerable to a fresh spike higher as safe-haven demand returns.
USD & NFPs
Traders will also be keeping an eye on USD this week with the headline US jobs report at the top of the week the headline event to note. If jobs are seen dropping sharply, as excepted, this should keep USD pressured lower near-term. reviving the focus on Fed easing expectations. Depending on what we’re hearing on the US/China front, this should help drive gold prices higher through the end of the week. Similarly, any surprise upside in Friday’s data should feed into current bearish sentiment in gold.
Technical Views
Gold
For now, the correction lower in gold is holding at the retest of the broken bull channel highs and the 3,254.65 level. While this area holds, focus is on a resumption of the bull trend and a return to highs. Should we slip below here, however, 3,164.82 will be the next support to watch in line with weakening momentum studies readings.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.