Gold Analysis 22.02.2019

Gold futures traded in a narrowly bullish range during the Asian session for the second consecutive weekly gain, shrugging off the US dollar's third-day low since Feb. 6, according to the inverse relationship between them on the eve of European Central Bank President Mario Draghi at the University of Bologna and the members of the Federal Open Market Committee in New York later on Friday and looking forward to the fruits of trade talks between America and China in Washington.

Gold futures for April delivery rose 0.11% to currently trade at $ 1,327.40 per ounce, compared to the opening at $ 1,325.80 per ounce, while the US dollar index rose 0.03% to 96.62. Higher in two weeks compared to the opening at 96.59.

Investors are waiting for federal Federal Reserve Chairman John Williams to speak at a panel discussion entitled "Inflation Outlook with a High-Pressure Economy" before giving the closing remarks of the first annual joint research day On Quantitative Instruments for Macroeconomic and Financial Monitoring, organized by the Bank of Atlanta and Bank of New York.

Later, Fed Deputy Governor Richard Clarida will speak to us at the US Monetary Policy Forum on "Reviewing the Federal Reserve for Monetary Policy Strategies, Financial Instruments and Communications" before we see the participation of St. Louis Governor James Pollard and Deputy Governor Federal Randall Quarles at a panel discussion entitled "The Future of the Federal Reserve Balance Sheet."

This came hours after the minutes of the Federal Open Market Committee meeting, which was held on 29-30 January, during which Federal Reserve policy makers kept interest rates at between 2.25% and 2.50% Cut bond repurchase by $ 50 billion a month. The committee said it was determined to be patient and monitor economic data before resuming tightening monetary policy.

In a press conference following the FOMC meeting at the end of last month, Federal Reserve Governor Jerome Powell noted that the Federal Reserve will be patient and monitor economic data as the downside risks to the economy mount from global growth and financial market volatility, Explaining that the continuation of that approach will depend on the economic data during the coming period.

In the same context, the Federal Reserve Governor Paul said last Tuesday that economic data confirm that the US economy is in a good position and that unemployment rates are stabilizing at the lowest in half a century, with the fact that there are some groups in American society do not feel prosperous after , And that the reflection of interest movements on the markets takes some time, saying he did not see the risks of economic recession high.

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:

The price of gold is approaching our awaited target at 1318.00 and fluctuating around the 50% Fibonacci level now, accompanied by negative signs through Stochastic, which makes us expect the bearish bias to continue in the coming sessions, noting that exceeding this level will push the price to test the 1310.00 level which represents the most important support For short-term trading.

On the other hand, keep in mind that a breach of 1330.00 and then 1336.20 will stop the expected decline and lead the price to resume the main bullish trend, with the next key target at 1352.50.

The trading range for today is among the key support at 1310.00 and resistance at 1336.00.

The general trend for today is bearish.