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Gold prices continue to rise due to the lingering uncertainty in US-China trade relations

Dec 20 2019, 01:32 PM (+06) | Fortfs.com

Locally, gold prices retain an upward movement due to the remaining uncertainty in US-Chinese trade relations. Yesterday, US Secretary of the Treasury Stephen Mnuchin confirmed that the parties plan to sign an interim foreign trade agreement in early January next year. But later, an unexpected statement was made by Canadian Prime Minister Justin Trudeau: "The United States should not sign a final agreement with China that would not provide a solution to the question of the fate of Meng and the two Canadians." It should be pointed out that the daughter of Huawei founder Meng Wanzhou was detained in Vancouver on suspicion of the United States for fraud. In response, the Chinese authorities detained two Canadian citizens, trying to put pressure on Ottawa to free Meng.

As long as the uncertainty in relations between the United States and China remains, investors will show an increased interest in defensive assets. Therefore, gold retains good prospects for the further development of a moderate upward movement.

Within the economic calendar today it is worth paying attention to the publication of final data on the US GDP growth for the 3rd quarter.

Within a medium-term time frame, gold continues to be traded in a wide horizontal channel of 1460.00-1483.00. As a part of this, an upward movement is now developing in the direction of the level of 1483.00. It is worth waiting for the formation of a trend movement only after the price fixation at one of the borders of the horizontal channel.

Resistance Levels: 1483.00, 1490.00, 1505.00;

Support Levels: 1475.00, 1460.00, 1455.00.

The main scenario - an increase towards 1483.00 and further downward movement.

An alternative scenario - a breakdown of support at the level of 1475.00 and a further decline towards 1460.00.

The fundamental outlook is neutral. Within the daily framework, we consider longs from the level of 1475.00.

 

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