Gold Analysis 28.10.2019

Gold futures fluctuated in a narrow range tilted lower during the Asian session to witness the second consecutive rebound from the highest since October 10 amid the positive stability of the US dollar index according to the inverse relationship between them on the eve of developments and economic data expected on Monday before The US economy is the world's largest and following the report, which touched on the progress of trade talks between the United States and China and hope for a deal later this year.

At 04:45 am GMT gold prices rose 15% to trade at $ 1,504.77 an ounce compared with the opening at $ 1,502.41 an ounce, with the US dollar index 0.01% to 97.86 compared to the opening at 97.85.

Investors are currently awaiting the US economy's preliminary reading of the Wholesale Inventories Index, which may reflect accelerating growth to 0.3% vs. 0.2% in August. Meanwhile, the Trade Balance of Goods Index showed the deficit widened to $ 73.5 billion versus $ 72.8 billion in August came hours after the report boosted the chances of completing the first phase of the US-China trade deal at the Asia-Pacific Economic Cooperation (APEC) summit in Chile next month.

On Tuesday, markets are looking ahead to the opening of the FOMC meeting in Washington, which is expected to cut interest rates on Fed funds by 25 basis points for the third consecutive meeting to between 1.50% and 1.75% ahead of the upcoming Bank Governor's press conference. Federal Reserve Jerome Powell on Wednesday, following US President Donald Trump's demand for further stimulus and rate cuts.

Investors are also looking to unveil the preliminary third quarter GDP for the United States on Wednesday, which could show a slowing pace of growth for the world's largest economy to 1.6% versus 2.0% in the second quarter. The quarterly growth slowed to 1.8% from 2.4% in the second quarter.

Preliminary data on the US labor market is also expected to be released on Wednesday with the release of the private sector employment change, which may reflect a slower pace of job creation to 125,000 jobs versus 135,000 in September, hours before the release. Monthly Non-Farm Payrolls and Unemployment Rate plus Hourly Income for October.

Technical Analysis

The price of gold conducted a retest of the breached resistance of the descending channel and maintained its stability above it, in conjunction with the arrival of stochastic to oversold areas, waiting to stimulate the price to resume the rise in the coming sessions.

Therefore, the bullish scenario will remain intact over intraday basis, targeting 1535.00 then 1555.00 mainly, noting that breaching 1489.00 will stop the suggested rally and press the price to return to the bearish corrective path again.

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

Expected trend for today: Bullish