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Gold keeps on consolidating in tight range, the weekly close in focus

Jan 18 2019, 02:14 PM (+06) | Fortfs.com

Yesterday gold lost in price about 0.15% but that is a kind of minor daily loss not changing the overall picture as the precious metal is traded in a tight formation with sideway direction. We mentioned earlier that the current gold price pattern resembles the flag figure, if it is true than this consolidation might not last long.

Yesterday gold demand decrease somewhat after some Brexit risks eased. Earlier Teresa May said that the government would provide a further action plan for the implementation by the Monday 21 of January. Thus, the risks of "hard" Brexit significantly decreased, and this eased the pressure on the Euro, British Pound, and to a lesser extent on the gold market.

American dollar retains a strong influence on the yellow metal, was trading without significant changes too. According to the dollar index, the day was closed with a very modest growth of 0.05%, which strongly restrained gold volatility.

Earlier Wall Street published interesting information. With reference to informed sources, the jornal reported that discussions are underway in Washington on the possible abolition of duties on Chinese goods in order to stabilize the global economy situation. In turn such a measure could force China to make serious concessions in the trade confrontation between the two countries, which causes serious damage to the entire world economy. US economy Secretary Stephen Mnuchin provided this idea. However, this decision is opposed to US Trade Representative Robert Lightheiser, who believes that China may perceive concessions from the US as a sign of weakness. The abolition of duties can be a very strong factor of pressure on gold, but so far this is just a speculation.

Today we will look into a large block of US important statistics, therefore, most likely, the focus of investors will be on geopolitical news, and not the economy.

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