Sterling Rips, Gold Slips
|Major FX pairs are finding a risk appetite increase in the past trade day, lifted by some Brexit optimism, but mainly the trade war headlines seem to suggest that a positive breakthrough is close.
I am a raging optimist that the APEC summit in November will produce a trade deal, even if it’s a partial deletion of US tariffs for an interim deal before a full blow removal of all tariffs.
There is no doubt that the US economic picture & China economic landscape are feeling the squeeze from their own trade jostling’s. This is not ideal for both economies and as such my risk-on play is to Buy SP500 and Sell Gold.
Meanwhile, the Brexit pathway is a millimetre away from the UK exiting smoothly on the 31st October deadline, with last minute approval last week by the EU opening the door for the UK lawmakers to vote this week on their withdrawal bill.
I maintain very firm targets for GBP/JPY at 148.00 and for GBPUSD at 1.3500.
Bottom line for Gold traders:
Gold is a SELL from $1,485.
3x Risk backdrop notes, driving improved risk sentiment, pulling GOLD lower?
1) Trade Headlines swirling positive between US & China.
2) Brexit optimism is a huge relief to markets.
3) US Fed still 60% chance to cut rates in October.
*Sell* Gold $1,485
Target 1: $1,460
Stop Loss: $1,505
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