Gold analysis 11.12.2019

Gold price futures fluctuated in a narrow range tilted to the upside during the Asian session amid the decline of the US dollar index for the eighth session in nine sessions from its highest since October 15, according to the inverse relationship between them on the cusp of developments and economic data expected today Wednesday by the US economy These include the decisions and directions of the Federal Reserve's monetary policy makers and the Federal Reserve Governor Jerome Powell's press conference, amid investors' pricing of developments in the trade war between Washington and Beijing.

At exactly 03:20 am GMT, gold futures for February delivery rose 0.01% to trade at $ 1,468.60 per ounce compared to the opening at $ 1,468.50 per ounce, knowing that the contracts started the trading session on an upward price gap after yesterday's trading was concluded At $ 1,468.10 per ounce, with the US dollar index down 0.01% to 97.50 compared to the opening at 97.51.

Investors are awaiting by the US economy to disclose inflation data with the release of the consumer price index, which may reflect a slowdown in growth to 0.2% compared to 0.4% last October, while a substantial reading of the same indicator may show stability in growth of 0.2%, while The annual reading of the index may indicate acceleration of growth to 2.0% compared to 1.8%, and the substantial annual reading of the index may reflect the stability of growth at 2.3%.

This comes in conjunction with the activities of the Federal Open Market Committee meeting held in Washington, through which it is expected to remain on the short-term benchmark interest rates for the second consecutive meeting at between 1.75% and 2.00%, while revealing the expectations of the members of the committee for the rates of growth, inflation and unemployment. In addition to the future of interest rates for the next three years.

Up to the press conference that Fed Governor Jerome Powell will hold about half an hour after the FOMC meeting ends to comment on the Fed’s policy makers ’decisions that have been witnessing widespread criticism by US President Donald Trump who is asking the Federal Reserve and his Governor Powell to move forward in Reducing interest on federal funds "to zero or less".

Otherwise, tomorrow (Thursday) markets are looking to the ECB meeting, during which the monetary policy makers of the European Central Bank will decide to maintain interest rates at their current zero levels and stabilize the marginal lending rate at 0.25% in addition to maintaining the interest rate on negative deposits. -0.40% and proceed with the quantitative easing program at 20 billion euros per month, as long as necessary.

This comes before we also witness Thursday the European Central Bank Governor Christine Lagarde’s press conference, which is her first press conference after she took over from former Governor Mario Draghi at the beginning of last month, and in conjunction with the parliamentary elections in Britain, which may directly reflect on the exit file. The United Kingdom from the European Union at the preset date with the end of next January.

Looking at the developments of the trade war between the two largest economies in the world, we followed yesterday. White House Economic Adviser Larry Kudlow expressed that Washington's activation of customs tariffs, adding 15% to Chinese goods valued at $ 156 billion by next Sunday, is still "on the table", and this came after The Wall Street Journal also reported yesterday that the United States plans to delay the imposition of additional fees as part of the efforts of the parties to reach an agreement.

Technical analysis

The narrow range continues to dominate gold price trades, which is moving within the ascending sub channel that forms a potential bearish continuation flag pattern, noting that the stochastic is providing a negative cross signal now, which constitutes a negative incentive that we expect will contribute to pushing the price to resume the bearish trend whose targets begin at 1447.00 extends to 1413.10, while stability below 1467.00 represents the first condition for achieving the proposed targets.

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

Expected trend for today: bearish.