Gold analysis 09.12.2019

Gold price futures fluctuated in a narrow range that tilted back down during the Asian session to witness its bounce back for the third session in four sessions from its highest since November 7 amid the succession of the US dollar index rebound from the lowest since the fourth of the same month according to the reverse relationship between them after The economic developments and data that were reported from the Asian economies, with investors looking to the decisions and directions of the Federal Reserve and the European Central Bank, in addition to the British elections later this week.

At exactly 03:17 AM GMT, gold price futures for February delivery fell 0.02% to trade at $ 1,463.80 per ounce compared to the opening at $ 1,464.10 per ounce, knowing that the contracts started the session’s trading on a falling price gap after the week’s transactions ended The past at $ 1,465.10 an ounce, with the US dollar index rising 0.01% to 97.71 compared to the opening at 97.70.

We have followed the disclosure by the General Administration of Customs of China (CGAC) on the reading of the Trade Balance Index, which showed that the surplus has shrunk to 274 billion yuan, equivalent to $ 38.7 billion compared to 301 billion yuan, equivalent to $ 42.8 billion last October. Contrary to expectations, which indicated a surplus of 300 billion yuan, equivalent to $ 44.5 billion, as exports and imports increased during the past month.

We would like to point out that the decline in Chinese exports for the fourth month in a row during November, with exports of China, the largest Asian economy and the second largest economy in the world after the United States, decreased by 1.1% from what it was in the same month last year, amid declining exports to The United States, 23%, reflects the impact of the ongoing trade war between the world's two largest economies on trade volume between the two parties.

It is reported that White House economic advisor Larry Kudlow noted Friday that Washington is close to concluding a trade agreement with Beijing, explaining that US President Donald Trump seeks to reach a good agreement with China, adding that December 15 is an important date regarding tariffs and that the American administration They use tariffs as part of their trade negotiations and push China to expand purchases of US agricultural products.

The markets are looking to Washington’s approval by the middle of this month of whether or not to activate a 15% increase in tariffs on Chinese goods worth $ 160 billion. It is reported that US President Trump expressed last week that he prefers in one way or another to postpone the conclusion of a trade deal with China until after the 2020 presidential elections. , With his statement that Beijing wants to conclude a deal at the moment with Washington and that "we will see whether the deal will be valid or not."

Other than that, we followed up on the Japanese economy to reveal the seasonally adjusted final reading of GDP, which showed an acceleration in the pace of growth to 0.4% compared to 0.1% growth in the previous initial reading for the third quarter and compared to 0.3% growth in the previous reading for the last second quarter, while the annual reading of the GDP showed GDP measured by prices, stability at 0.6%, also in line with expectations and 0.4% growth.

This came also in conjunction with the disclosure of the current account reading, which showed the widening of the surplus to 1,817 billion yen compared to 1.613 billion yen last September, outperforming the expectations that indicated the widening of the surplus to 1,807 billion yen, as the seasonally adjusted reading of the same indicator indicated the widening of the surplus to 1.732 billion yen from 1.485 billion yen in September, also beating forecasts of 1.731 billion yen.

In another context, the markets are looking for tomorrow, Tuesday, for the launching of the activities of the Federal Open Market Committee meeting that will be held tomorrow and the day after tomorrow Wednesday in Washington, which is expected to remain on the short-term reference interest rates for the second consecutive meeting at between 1.75% and 2.00% simultaneously. With the disclosure of the expectations of members of the committee to the rates of growth, inflation and unemployment in addition to the future interest rates for the next three years.

Up to the press conference that will be held by Federal Reserve Governor Jerome Powell on Wednesday, exactly half an hour after the end of the FOMC’s meeting to comment on the decisions of the Fed’s monetary policy makers, which has been witnessing widespread criticism recently by US President Trump, who is calling on the Federal Reserve and its Governor Powell to move forward. In cutting interest on federal funds "to zero or less".

Next Thursday, the markets are looking to the ECB meeting, during which monetary policy makers at the European Central Bank are expected to decide to maintain interest rates at their current zero levels and to stabilize the marginal lending rate at 0.25% in addition to remaining on the deposit interest rate negative -0.40 % And move forward with the quantitative easing program at 20 billion euros per month, as long as necessary.

This comes before we also witness next Thursday the European Central Bank Governor Christine Lagarde’s press conference, which is her first press conference after she took over the post of former Governor Mario Draghi at the beginning of last month, and this comes in conjunction with the actual parliamentary elections in Britain which may be directly reflected On the UK exit file on the preset date by the end of January.

Technical analysis

Gold price provided negative trading last Friday evening, moving above the moving average 50 and approaching our first awaited target at 1447.00, reinforcing the expectations for the continuation of the downward correction, which is organized within the descending channel that appears in the picture, noting that breaking the mentioned level will push the price to 1413.10 as a station Next major.

Thus, the bearish bias will remain likely for the coming period, provided that the price maintains its stability below 1489.00.

The expected trading range for today is between 1445.00 support and 1470.00 resistance.