Gold Analysis 25.10.2019

Gold futures fluctuated in a narrow range tilted lower during the Asian session amid the positive stability of the dollar index according to the inverse relationship between them on the eve of developments and economic data expected on Friday by the US economy and following the criticism of US Vice President Mike Pence China's actions against protesters in Hong Kong His calls for a broader link between the world's two largest economies have been announced after the British prime minister said he might ask for early general elections on December 12.

At 03:50 am GMT gold futures for December delivery fell 0.09% to trade at $ 1,505.00 an ounce compared with the opening at $ 1,506.40 an ounce, knowing that the contracts started the trading session on a bullish gap after the close of trading Yesterday at $ 1,504.70 an ounce, with the US dollar index up 0.01% to 97.70 compared to the opening at 97.69.

Investors are currently awaiting the US economy to release the final reading of the University of Michigan Consumer Confidence, which could show a steady expansion of 96.0, little changed from the initial reading for October and 93.2 in September. The US is reading the federal budget which may show a surplus of $ 83.5 billion versus a deficit of $ 200.3 billion last August.

On Thursday, Vice President Pines said in a speech in China that his country is ready to start a new future if Beijing retracts from unfair trade, explaining that Washington is working to build a relationship based on justice and respect, adding that the United States It does not seek to confront China, but aspires to fair trade, an open market and respect for Washington's principles.

US Vice President Pines also expressed hope for the completion of the first phase of the trade agreement with China at the Asia-Pacific Economic Cooperation (APEC Summit) in Chile next month, and Beijing's emphasis on the purchase of additional US agricultural products, explaining that what will happen in the 21st century Depends largely on the fate of relations between Washington and Beijing.

In the same context, Pines said that US President Donald Trump hopes to move to structural challenges after the completion of the first phase of the trade agreement, pointing out that the Trump administration believes that if Washington and Beijing can achieve economic cooperation properly, it is possible to lay the foundations To address other issues, he said Beijing has not taken any clear measures to improve economic relations between the two countries.

US Vice President Pines made the remarks hours after the Chinese State Council said Wednesday that Beijing was determined to increase imports of US agricultural goods and products and keep the RMB exchange rate within a stable range and that Asia's second largest economy after the United States would continue to support Stability of foreign investment and trade.

US President Donald Trump said earlier this week he hoped to sign a trade deal with his Chinese counterpart Xi Jinping later in the month in Chile, noting that a partial trade agreement between Washington and Beijing is underway. China is now buying American agricultural products.

Meanwhile, White House economic adviser Larry Kudlow said Monday that tariffs on Chinese goods could be abolished if the first phase of trade talks between Washington and Beijing is completed well, saying things look good and negotiations between the two sides are good. They still exist, adding that human rights are among the important files in the negotiations between America and China.

Chinese Vice Premier Liu Hu said Saturday that the United States and China have made "significant progress" in trade talks, following a partial trade agreement earlier this month, adding that both Washington and Beijing are working Signing a written agreement between them as a basis for resolving the existing trade disputes between the two parties.

In view of the developments of the Brexit file, the markets are currently awaiting the decision of the European Union on the request of the British government last Saturday to extend the deadline for the exit of the United Kingdom from the European Union by three months until the end of January, has stated the new European Commission President Ursula Von der Leyne yesterday that the idea of ​​extending the exit seems guaranteed, but no decision has yet been made on the appropriate extension period.

In the same vein, French President Emmanuel Macron demanded that the extension of Britain's exit from the European Union to a maximum until November 15, saying that he wants to increase pressure on the British Parliament to support the exit agreement reached by British Prime Minister Boris Johnson this week He added that he feared that prolonging the exit timeframe could lead to a possible exit scenario without agreement.

On the other hand, Prime Minister Johnson also expressed yesterday that he would allow the British Parliament to have sufficient time to discuss the UK exit agreement and the timetable for the exit, if the approval of a general election on 12 December, adding that EU leaders are expected to approve the extension beyond October 31.

In the event that the EU decides to extend the deadline for Brexit for a short period of two weeks or a month, until mid-November or the end of next month, British Prime Minister Johnson may work to pass his exit agreement with Brussels again through parliament. In the case of a three-month extension, Johnson is expected to call parliament to vote on early general elections.

Technical Analysis

Gold finished yesterday's trading above the descending channel resistance, which stops the negative scenario suggested in our recent reports and leads the price to start a new bullish wave, on its way to regain the main bullish trend again.

Moving above SMA 50 supports the expected rise, which targets start at 1535.00 then 1555.00, while breaking 1489.00 represents a negative factor that will press the price to resume the bearish corrective trend.

Expected trading range for today is between 1490.00 support and 1520.00 resistance.

Expected trend for today: Bullish.