Gold Analysis 21.11.2019

Gold futures fluctuated in a narrow range tilted to decline during the Asian session to witness the bounce for the second session from the highest since November 7 amid the dollar index rebound for the fourth session of its lowest since the fifth of this month according to the inverse relationship between them on the eve of developments and data In the shadow of the developments of the trade war between Washington and Beijing, which exceeded its first year recently.

Gold futures for December delivery fell 0.27% to trade at $ 1,471.10 an ounce compared with the opening at $ 1,475.10 an ounce, knowing that the contracts started the session on a bullish gap after the close of trading Yesterday at $ 1,474.20 an ounce, with the US dollar index up 0.03% to 97.89 compared to the opening at 97.86.

Investors in the US economy are awaiting the release of last week's claims on the 16th of this month, which may reflect a decline of 10K to 215K from 225K in the previous week. On the ninth of this month stabilized at 1,683 thousand applications.

This comes in conjunction with the disclosure by the largest industrial country in the world for the reading of the Philadelphia industrial index, which may reflect an expansion to 7.0 from 5.6 in October, before we see the release of housing market data with the release of the existing home sales index. That could show a rise of 2.1% to 5.49 million, compared to a decline of 2.2% at 5.2.2 million last September.

Markets from the world's largest economy are also looking to reveal the leading indicators that may show a 0.1% decline in October, following hours of the FOMC minutes from October 29-30. October, in which interest rates were cut for the third time in a row by 25 basis points to between 1.50% and 1.75%.

On the other hand, yesterday we followed the market's concern that the expected “first phase” trade deal between Washington and Beijing will not be signed this year, less than a month before the US administration expects to impose tariffs on Chinese goods and commodities. Especially after US President Donald Trump recently threatened to expand tariffs if his country did not reach an agreement with China.

We would like to point out that sources familiar with the bilateral talks between Washington and Beijing said they did not hope to reach a trade agreement this year and that the talks may be extended for next year, with US officials believe that the abolition of customs duties on Chinese goods may Discussions on intellectual property and technology transfer are not allowed, which is not a victory for US President Trump.

In the same vein, Reuters addressed the concerns of US trade negotiators about the reactions of the US president to any trade agreement may be reached, as he may object to the terms of the agreement at any time, while we would like to note, that US President Trump said yesterday that the trade talks China and China will continue and Beijing still wants to conclude the trade agreement, wondering whether he would like to conclude the deal.

Yesterday, we also followed the White House spokesman's assertion that trade negotiations with China are still in progress and that progress has been made towards the signing of the first phase of the trade agreement between the world's two largest economies. American company to supply some goods to the Chinese company Huawei.

Yesterday, Chinese Foreign Ministry spokesman Geng Shuang expressed his country's "condemnation and severity" of the bill known as the Human Rights and Democracy Act in Hong Kong, hours after the US Senate passed legislation supporting Hong Kong protesters. The bill is still before the House of Representatives for a vote before it is passed to US President Trump for approval.

Technical Analysis

The price of gold is fluctuating around the breached resistance of the descending channel, and we note that the Stochastic is starting to cross positively now, waiting for the price to stimulate the resumption of the bullish intraday direction, whose main target is at 1489.00.

Therefore, we will maintain our positive expectations unless 1470.00 is breached and hold below it, noting that the expected rally is temporary, and we await the resumption of the bearish corrective wave after achieving the mentioned target.

Expected trading range for today is between 1460.00 support and 1490.00 resistance.

Expected trend for today: Bullish.