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Gold declines on positive news from Washington

Oct 11 2019, 03:47 PM (BDT) |

Gold, like other defensive assets, completed yesterday's trading in the red zone amid positive news about the progress of US-Chinese trade negotiations.

Donald Trump said yesterday that the first day of the talks went very well. White House officials also noted that the results of the first day of negotiations far exceeded their expectations. Such comments increase the likelihood of an interim agreement and the abolition of new US duties scheduled for next week and December.

Against the background of these statements, the demand for more risky and highly profitable assets has increased sharply, which always has a negative effect on gold.

Today, the US economic calendar does not have important news, so geopolitical news will have a major impact on the dynamics of market. The focus will remain on trade negotiations between the United States and China. Positive news from Washington will increase pressure on the yellow metal.

On the chart, from the level of 1510.00 the price resumed its downward movement. The main target is the level of 1485.00, has not yet been achieved, so today the downward movement vector remains a priority.

Resistance Levels: 1500.00, 1510.00, 1525.00;

Support Levels: 1485.00, 1475.00, 1460.00.

The main scenario is a decline to 1485.00 from current levels.

An alternative scenario is a breakdown of intraday resistance at 1500.00, an increase to 1510.00 and the resumption of the downward movement.

The market is dominated by a negative fundamental background. We expect a continuation of the downward wave. We consider shorts from the levels of 1500.00 and 1510.00 (a safer entry point).

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