GOLD Analysis 14.10.2019

Gold futures fluctuated in a narrow range tilted lower during the Asian session amid the rise of the US dollar index according to their inverse relationship following the developments and economic data that followed on Monday on the Chinese economy, the largest consumer of metals in the world and amid the lack of economic data by the US earlier this week because of Columbus Day Holiday Following developments in trade talks between Washington and Beijing.

At 04:32 am GMT gold futures for December delivery fell 0.11% to trade at $ 1487.19 an ounce compared with the opening at $ 1486.45 an ounce, with the US dollar index rose 0.02% to 98.38 compared to the opening at 98.36.

The trade balance reading showed that the surplus widened to 275 billion yuan ($ 39.7 billion) from 240 billion yuan ($ 34.8 billion) in August, beating expectations for a widening surplus. To 254 billion yuan ($ 34.8 billion), export and import deceleration slowed more than expected last month.

Otherwise, the US president said that the US and China agreed on the outline of a deal that could be signed early next month, which boosted market hopes about the chances of Washington and Beijing avoiding an escalation of their trade war. The widening surplus also contributed to China's trade balance. Stimulate risk appetite for investors to weigh heavily on the performance of gold prices, which is a safe haven and alternative investment.

Last week's high-level trade talks between the United States, the world's largest economy, and China, the world's second-largest economy, resulted in a "Phase I" trade agreement as part of a much-anticipated expanded trade agreement. Tariffs on Chinese goods worth 250 billion to 30 percent from 25 percent by October 15.

On the other hand, Beijing is expected to make purchases of expanded US agricultural products and take steps to protect intellectual property protection and financial services as well as not weaken the Chinese yuan in order to gain a competitive trade advantage. While the freeze of the decision to raise tariffs and the commitment to expand the purchase of agricultural products were not mentioned.

On the other hand, we also followed last weekend's remarks by British Prime Minister Boris Johnson that despite the fact that no agreement has yet been reached between Britain and the European Union, it is moving forward towards an agreement on an orderly exit from Britain. The EU is on schedule by this month, saying that an agreement with Brussels would be beneficial not only to his country but to all parties in Europe.

The comments came hours after British Prime Minister Johnson and Irish leader Leo Faradkar confirmed the possibility of reaching an exit deal following talks on Thursday, boosting market hopes for eventual access. Yesterday more work was needed to secure an agreement on an orderly Brexit.

Technical Analysis

Gold attempted to break the 1485.00 level but was unable to close the daily candle below it, stuck between the trend confirmation levels of the aforementioned support and resistance now falling to 1515.00, thus we continue to remain neutral until the price succeeds in confirming the breach of one of these levels.

The breach of the mentioned support will put the price under additional negative corrective pressure reaching the next targets at 1447.00 then 1413.10, while breaching the resistance will lead the price to regain the main bullish trend again, whose targets start with testing 1555.00.

Expected trading range for today is between 1470.00 support and 1505.00 resistance.

Expected trend for today: Neutral.