Gold Analysis 08.02.2019

Gold futures traded in a narrow, sloping range during the Asian session to see their fourth session rebound in six sessions since April 25, shrugging off the negative stability of the US dollar index to reflect the end of its longest daily gains since mid- In November 2016, in the shadow of renewed investor fears about tensions and trade talks between Washington and Beijing and concern over prospects for economic growth.

Gold futures for April delivery fell 0.09% to currently trade at $ 1,312.60 per ounce, compared with the opening at $ 1,310.90 an ounce, while the US dollar fell 0.02% to 96.58 from the opening at 96.60. 

US President Donald Trump said he did not intend to meet Chinese President Xi Jinping before the March 11 deadline for a trade deal between the United States and China, raising concerns about a trade war between the world's biggest economies. , On the eve of US Treasury Secretary Stephen Manchin's visit to Beijing next week.

Otherwise, we also followed yesterday the Bank of England Governor Mark Carney cut his forecast for the UK economy's growth this year to the slowest pace in a decade, with the risk of a UK exit without an EU agreement and trade tensions between the US and China in recent times , About two hours after the European Commission lowered its forecast for the pace of growth of the euro area economies for the same reasons.

In another context, we followed the former Federal Reserve Governor Janet Yellen yesterday that she expected the next step by the Federal Reserve to interest rates to be cut, especially if the slowdown in global economic growth caused damage to the US economy, explaining that the decision to cut interest rates will be available In that case, adding that if the damage grows, the Fed will return to quantitative easing policies again.

On the other hand, the World Gold Council's statistics last week pointed to the global purchases of gold by the global central banks in 2018 to their highest level since 1967. Purchases rose to 651.5 metric tons, up 74% from 2017 to 375 tons Metric tonnes, with many countries buying gold, topped by Russia, at 274 metric tons, which surpassed China, the world's largest consumer of metals, and inspire both Poland and Kazakhstan.

Global gold consumption rose to 4,345.1 metric tons last year from 4,159.9 metric tons in 2017. Retail investment in bullion and gold coins rose 4 percent to 1,090.2 metric tons, supported by Iran's demand increase of 222 percent to 62 metric tons, Demand for jewelry has stabilized at around 2,200 metric tons with increased consumption compensation in both China, the United States and Russia for lower demand from the Middle East and India.

In contrast, the demand for financial institutions fell by 67% from the year 2017, when the world supply of gold increased 1% to a total of 4,490.2 metric tons in 2018. The gold futures contracts last month made the fourth monthly gain, respectively, illustrated Has seen its longest monthly gains since late 2010, after ending its longest monthly loss march since late 1996.

Technical Analysis

Gold is fluctuating around SMA 50, and we see that Stochastic is currently overbought and offers a negative cross signal that we expect to contribute to the resumption of the downside move targeting 1294.00 and then 1286.70 mainly.

Therefore, we will continue to bias the bearishness during the upcoming sessions unless the price is pushed to breach the 1316.65 level and stability above it.

The trading range for today is among the support at 1286.00 and resistance at 1316.00

The general trend for today is bearish