Gold Analysis 04.10.2019

Gold futures fluctuated in a narrow upward range during the Asian session to witness the rebound for the fourth consecutive session from the lowest since August 4 amid the negative stability of the dollar index, indicating its rebound for the fourth consecutive session from the highest since May 12, 2017 According to the inverse relationship between them on the eve of developments and economic data expected on Friday by the US economy, the largest economy in the world, which includes the speech of the Governor of the Federal Reserve and the speech of members of the Federal Open Market Committee.

Gold futures for December delivery rose 0.40% to trade at $ 1510.40 an ounce compared to the opening at $ 1506.62 an ounce, amid the US dollar index fell 0.01% to 98.87 compared to the opening at 98.88.

Investors are awaiting the US economy to release last month's labor market data, which may reflect a steady unemployment rate of 3.7%, little changed from August, while the change in jobs index for non-agricultural sectors may show accelerated job creation. The median hourly rate may show growth slowed to 0.3% vs. 0.4%.

This comes in conjunction with the release of the Trade Balance Index, which may reflect the widening of the deficit to $ 54.7 billion compared to $ 54.0 billion in July, and with the opening of the Federal Open Market Committee and Chairman of the Federal Reserve Bank of Boston, Eric Rosengren opening remarks of the annual conference hosted by the Bank Federal Reserve in Boston.

Federal Reserve Governor Jerome Powell gave the opening remarks at the Fed listening event hosted by the Federal Reserve Bank of Washington, before FOMC and Fed Governor Lyle Brainard moderated a panel discussion titled "Measuring Maximum Employment." In a changing labor market "and within the realities of a Fed event listens.

Markets are also looking forward to Federal Reserve Chairwoman and Kansas City Federal Reserve Chairman Esther George concluding remarks at the 61st annual meeting of the National Association of Business Economics in Denver, before another panelist and Fed deputy Randall Quarles oversaw a panel discussion on the importance of stability. Prices and lower inflation in today's economy "and that also within the realities of the event the Fed listens.

This comes amid anticipation of any hints about the future of monetary policy by the Federal Committee in the wake of a series of disappointing economic data from the US economy, which boosted the chances of the monetary policy makers at the Federal Reserve to cut interest rates for the third time in a row by 25 basis points during a meeting FOMC by the end of this month.

It is noteworthy that US President Donald Trump on Tuesday expressed that the Federal Reserve's monetary policy and the strength of the dollar are the reason behind the weak performance of the industrial sector in his country, pointing out that the Federal Reserve and his Governor Powell allowed the dollar to rise against other currencies, which negatively affected American manufacturers. He added that the interest rate on federal funds is very high and that the Federal Reserve is hostile to those decisions.

President Trump's tweets on his official Twitter account renewing his criticism of the Fed and Powell's monetary policy came after Tuesday's ISM manufacturing index showed deflation widened to 47.8 from 49.1 in August, beating expectations. It signaled an expansion at 50.4, reflecting the worst performance of the index since June 2009.

In view of global trade developments, we followed last Wednesday the World Trade Organization (WTO) issued a ruling allowing the United States to impose duties on its imports from the European Union amounting to about $ 7.5 billion annually due to the European Union's illegal financial support to the European aircraft manufacturer Airbus. US goods will be levied on EU goods by October 18.

The escalation of US trade protectionism with the EU has renewed market concerns about global trade tensions, coinciding with the prospect of a new round of high-level trade talks between the world's two largest economies by next week in Washington aimed at resolving trade disputes between the United States and China. As part of efforts to reduce the escalation of the trade war between Washington and Beijing.

Technical Analysis

Gold is trading around the 1500.00 level after yesterday's high, and the price faces a contradiction between the positive SMA 50 and the negative stochastic, which makes us continue to remain neutral until we get a clearer signal for the next trend, which we will get through breaching the resistance 1526.00 or breaking Support 1485.00.

The breach of the mentioned resistance will bring the price back to the main bullish path again, heading towards achieving positive targets starting at 1555.00, while breaking the support will press the price for a further bearish correction targeting initially 1447.00 zones.

Expected trading range for today is between 1485.00 support and 1535.00 resistance.

Expected trend for today: Neutral.