Gold analysis 31.07.2019

Gold futures traded in a tight range slipping into the Asian session to see their rebound to its second highest session since July 19, when it tested its highest since May 10, 2013 as the US dollar index rose for the fifth straight session And its stability near the top in two months according to the inverse relationship between them following the developments and economic data that followed the Chinese economy, the largest consumer of metals globally and on the threshold of developments and economic data expected on Wednesday from the US economy, the largest economy in the world Within the decisions and directions of monetary policy makers at the Federal Reserve

Gold futures for December delivery rose 0.10% to currently trade at $ 1,431.40 per ounce, compared with the opening at $ 1,430.70 an ounce, while the dollar index rose 0.02% to 98.06 compared to the opening at 98.04.

We have followed the China Logistics and Procurement Federation (CFLP) survey of the Industrial and Service Purchasing Managers' Indexes, which reported contraction in the industrial sector to 49.7 versus 49.4 in the previous reading for June, beating expectations of contraction of 49.6 The service sector contracted to 53.7 from 54.2 in June, worse than expected at 54.0.

On the other hand, investors are currently waiting for the US economy to release preliminary data for the labor market with the release of the index of change in private sector jobs, which may reflect the acceleration of job creation to 150 thousand jobs added to 102 thousand jobs added in June, before Hours of disclosure of the monthly report of non-agricultural jobs and unemployment rates in addition to the average income per hour for the month.

This comes before we also see later in the day by the world's largest economy reading the labor cost index, which may reflect a stable growth of 0.7%, unchanged from the first quarter, and before the disclosure of the Chicago Purchasing Managers Index May extend to 51.7 versus a contraction of 51.7 in June.

Leading to the release of the monetary policy statement of the Federal Open Market Committee meeting on July 30-31 and the Fed's decision on interest rates amid expectations that monetary policy makers will cut federal funds rates by 25 basis points to between 2% and 2% . This comes half an hour before the Fed's upcoming press conference, Jerome Powell.

US President Donald Trump said yesterday at the start of a meeting of the Federal Committee in Washington that the Fed was moving early and hasty and would like the Fed to stop tightening monetary policy and see a drastic cut in interest rates on federal funds. Adding that he was not confident of accepting China's proposals during the ongoing trade talks.

Investors are eyeing the ongoing US-China trade negotiations in Shanghai, which began yesterday with the visit of a US trade delegation led by US Trade Representative Robert Laitzer to China and ending today, which reflected the resumption of trade negotiations between the world's two largest economies after it was suspended in May, This comes before we see later in the month of next month a Chinese trade delegation in turn to Washington.

Technical Analysis

Gold managed to break through 1430.00 and get a daily closing above it, which supports our continued bullish outlook for the coming period, but it starts today with a bearish slope affected by stochastic negativity awaiting a positive momentum enough to push the pair higher again. 1450.00.

In general, we will hold onto our bullish outlook for the coming sessions provided stability above 1410.90.

The trading range for today is among the key support at 1415.00 and resistance at 1450.00

The general trend for today is bullish.