Gold aims to fill in the gap to $1400 as traders ascertain risk sentiment
- Negative headlines from Chinese media doubt optimism surrounding the US-China trade deal while challenging issues remain unresolved.
- Key PMI numbers from top-tier economies to offer intermediate trade opportunities.
Following its gap-down opening to $1387.20 on US-China trade truce, Gold prices recover to $1392.90 as markets evaluate risk concerns amid mixed headlines from Chinese media during the early Asian session on Monday.
Even if a trade ceasefire between the world’s two largest economies garnered risk-on sentiment at the day’s start, recent headlines from China continues to question investor optimism over the likeliness of a trade deal.
In addition to the long road to have a trade deal with the US, statements like Mexico and China can be partners against US pressure are likely showing Chinese media’s lack of appreciation to the recent trade truce.
It should also be noted that global risk barometer, the US 10-year treasury yield seesaws around 2.01% by the press time.
With the underlying issues concerning the technology transfers and intellectual property rights are still unresolved, negative comments from China’s press push global traders towards expecting another round of endless discussions between the two key economies.
Given the month-start week, Purchasing Manager Index (PMI) numbers from the key economies like China, the US, and the UK could offer additional information to determine near-term trade direction.
Technical Analysis
Unless breaking $1,400 support-turned-resistance, the yellow metal can keep signaling $1,370 level comprising 21-day exponential moving average (21-D EMA) to sellers whereas $1,425 and latest high around $1,438.65 can entertain buyers past-$1,400.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
