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Gold Demand Declines Before Trade Talks Between US and China

Oct 8 2019, 03:20 PM (BDT) | Fortfs.com

Gold closes the first trading day of the week in the red zone, under pressure from the dollar and moderately positive investor’s sentiment before the start of a new round of trade negotiations between the US and China.

The day before, White House economic adviser Larry Kudlow said progress could be seen in trade negotiations. The American side is ready to listen to all the proposals of its colleagues and consider them. Kudlow also noted that the White House is not currently considering limiting the listing of securities of Chinese companies on US exchanges.

Major stock indexes today are being traded in the green zone, indicating an increased interest of investors in riskier assets. Locally, this is a bearish signal for gold, so in the coming days we can see a continuation of the downward trend for this asset.

In the economic calendar today it is worth paying attention to the publication of data on the producer price index in the United States and the speech of the head of the Fed Jerome Powell.

Yesterday, the bears managed to push through the support at 1499.00, which provoked further development of the downward movement in the direction of the level of 1485.00. This is currently a key support level for the price. In case of breakdown, the next target for the movement will be the levels of 1475.00 and 1460.00.

Resistance Levels: 1493.00, 1503.00, 1512.00;

Support Levels: 1485.00, 1475.00, 1460.00.

The main scenario is a breakdown of support at 1485.00 and a decrease to 1475.00.

An alternative scenario is a breakdown of intraday resistance at 1493.00 and an increase to 1503.00.

A negative news background locally prevails on the market. The chart is dominated by bearish signals. Inside the day we consider shorts from the levels of 1493.00 and 1503.00.

 

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