Gold: On the defensive amid latest risk-on
|- Receding geopolitical tension, growth positive comments from the US President extend Gold’s previous pullback.
- Trade/political news can offer intermediate moves ahead of FOMC minutes, Jackson Hole Symposium.
Gold registers another failure to cross Tuesday’s high, mainly due to trade/political news, as it trades near $1,510 on early Monday.
The global risk-on sentiment extended after the US President Donald Trump said he doesn’t expect recession grabbed the headlines during the early Asian session. The move stretched after China’s central bank (the People’s Bank of China) signaled further moves towards free-floating currency by liberalizing interest rate changes for banks.
Likely receding geopolitical tension between the UK and Iran, due to the release of an Iranian oil tanker by Gibraltar also adds to the latest pullback in safe-havens.
Traders show little reaction to the US President’s trade negative comments as China’s response is still awaited while the Global Times portrayed a rosy picture of the world’s second-largest economy.
Portraying the mood, the US 10-year treasury yield surges by more than four basis points (bps) to 1.588% by the press time.
While trade/political headlines will keep entertaining traders, major market attention will be on this week’s Federal Open Market Committee (FOMC) Minutes and comments from Jackson Hole Symposium.
Technical Analysis
Unless breaking $1,480 on a daily closing basis, prices aren’t expected to aim for $1,452, comprising July high, which in turn portrays the bullion’s strength to flash accelerate the upside momentum on the break of $1,535.
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