Gold Analysis 30.10.2019

Gold futures fluctuated in a narrow upward range during the Asian session, ignoring 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 Wednesday by the US economy, the largest economy in the world, which includes decisions and directions of the Federal Open Market Committee and the Conference Fed Press Governor Jerome Powell.

Gold futures for December delivery rose 0.04% to trade at $ 1,491.10 per ounce compared to the opening at $ 1,490.50 an ounce, shrugging off the US dollar index 0.03% to 97.71 compared to the opening at 97.68.

Investors are awaiting the US economy to release preliminary data on the labor market with the release of the indicator of the change in the private sector jobs, which may reflect the slowing pace of job creation to 125 thousand jobs added to 135 thousand jobs added in September, hours before the release of Monthly Non-Farm Payrolls and Unemployment Rate plus Hourly Income for October.

The market is then looking to reveal the preliminary GDP figure for the US for the third quarter, which may show a slower pace of growth for the world's largest economy to 1.6% versus 2.0% in the second quarter, and the preliminary GDP reading measured in prices for the quarter. The quarterly pace of growth slowed to 1.8% from 2.4% in the second quarter.

This comes in conjunction with the FOMC meeting in Washington, which is expected to cut interest rates on federal funds by 25 basis points for the third meeting in a row to between 1.50% and 1.75%, and before we witness the upcoming press conference of the Federal Reserve Governor Jerome Powell, following US President Donald Trump's demand for more stimulus and interest rate cuts.

Powell noted in advance that the risks to the US economy are the uncertainty over the trade war between Washington and Beijing and the UK exit from the European Union. United and China to the agreement by the middle of next month.

In addition to Brussels's agreement on Monday to extend the Brexit until January 31, it limits the chances of interest rate cuts at the Fed meeting. Optimism for Washington and Beijing to conclude the first phase of the trade agreement at the Asia Economic Cooperation Summit The Pacific (APEC) in Chile shrank on Tuesday following a report followed by Reuters news agency.

A US administration official told Reuters yesterday about the developments in the trade war between the US and China and the chances of reaching the stage of the agreement between the parties, that it may not be signed, while expressing to Reuters, "If not signed in Chile, this does not mean that It just collapses, meaning it is not ready, "he said, hours after Trump on Monday predicted a trade deal with China would be" ahead of schedule. "

Technical Analysis

The price of gold stabilizes around 1489.00 level, and the price was subjected to a negative negative pressure yesterday, indicating that the price is heading for a further bearish correction in the intraday and short term, supported by moving below SMA 50, while stochastic provides positive signals that may protect the price from incurring further Of losses.

Therefore, we prefer to remain neutral on a temporary basis until the price confirms its position regarding 1489.00, where stability below it will confirm the start of the bearish corrective wave, whose next main target is at 1447.00, while upside above will reactivate the bullish scenario which initially targets 1535.00.

Expected trading range for today is between 1470.00 support and 1510.00 resistance

Expected trend for today: Neutral