Gold: Bulls and bears spar around $1287

  • Gold prices trade near $1286.50 during early Wednesday.
  • Doubts concerning global economic growth favor the yellow metal’s upside but the USD strength and question over China support sellers.
  • $1279 acts as immediate support with $1295 being nearby resistance to watch.

Gold trades near $1286.50 on early Wednesday. The yellow metal took a U-turn from six week low during late-Tuesday as comments from Fed policymakers questioned future rate-hikes. However, early-day strength of the US Dollar, likely backed by downbeat catalysts from the Australia and doubts over soft Brexit, confined the safe-havens upside.

Tuesday’s better than forecast prints of the US data couldn’t hold the Gold down for long as comments from the Minneapolis Federal Reserve President Neel Kashkari and Boston Fed President Eric Rosengren raised questions on the Fed’s future rate-hike trajectory. During their separate public appearances, the Fed policymakers added strength to the present ‘patience’ call for the rate-hikes as Rosengren said risks from macro events like Brexit, trade talks are looming large whereas Kashkari said that the U.S. economy is not at full employment.

Gains past-Fed leaders’ comments couldn’t last long as the US Dollar regained market attention after sluggish prints of the Australian GDP and speculations for rate-cuts from the Reserve Bank of Australia (RBA) diverted traders to the US Dollar in search of safety. 

Adding to the USD strength was EU-UK leaders’ inability to reach a Brexit deal and positive developments at the US-China trade negotiation front. It should also be noted that recent weakness in Chinese data-points and their central bank's forecast of slow growth can be considered as an additional lag for Gold as China is among top buyers of the precious metal.

While market rush for the greenback and weakness at China confined Gold’s upside, bulls didn’t leave the ground unguarded as pessimism surrounding global economic growth continued supporting the yellow metal for its risk-safety.

Gold Technical Analysis

Prices may find $1279 and $1276 as immediate supports ahead of testing 100-day simple moving average (SMA) near $1265.70.

Alternatively, $1295 and $1303 could check buyers’ strength before pleasing them with $1313.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Forex News

Latest Forex News

Editors’ Picks

When is the BOJ rate decision and how could it affect USD/JPY?

USD/JPY struggles to keep the recent run-up past-107.00 ahead of the BOJ on Wednesday. The pair earlier benefited from hopes of virus vaccine and upbeat earnings but fears of the highest alert in Tokyo questions the bulls.

Read more

AUD/USD extends the break above 0.70 on coronavirus vaccine hopes

AUD/USD extends its break above 0.7000, hitting the highest level in five weeks. The pair benefits from the risk-on market mood amid coronavirus vaccine hopes. The bulls remain undeterred by the latest US-China tensions. 


EUR/USD hits four-month high of 1.1423

EUR/USD prints a four-month high of 1.1423 in Asia. The pair witnessed a bullish breakout above 1.1349 on Tuesday. The pair closed well above 1.1349 on Tuesday, invalidating the bearish lower high setup created on the daily chart on June 23.


Gold: Daily chart shows temporary uptrend exhaustion

Gold's daily chart shows a bearish divergence of the MACD, a sign of uptrend exhaustion. A break below the 10-day SMA could prove costly. The metal looks vulnerable to price pullback.

Gold News

Chart of the Day: DXY

The DXY is in a "bear flag" pattern currently and the target is well below the 94.00 level on a breakdown. However, there is a downtrend line (blue) and if this is broken it will negate the bear flag and turn ...

Read more