Gold: Bulls emphasize USD moves more than market optimism to aim for $1315
- Gold trades near $1309 at the start of Asian trading on Thursday.
- Buyers prefer the bullion amid USD weakness, weighing less on Brexit driven positivity.
- Developments concerning US-China trade talk, Brexit and China data should be observed carefully.
Gold prices around $1309 during the initial hour of Asian trading on Thursday. The safe haven has been bulls’ favorite despite recent positive news from the UK as a decline in the US Dollar (USD) favors the yellow metal. Traders may keep an eye on risk sentiments mainly driven by Brexit developments and the US-China trade news whereas upcoming data from China can offer additional details to clarify the moves.
Not only early-week releases concerning the US retail sales and consumer prices index (CPI), recently published durable goods orders and producer price index (PPI) also weakened the US Dollar. As a result, commodities termed in greenback are taking advantage of the behavior.
It should be noted that the bullion traders gave little importance to the positive news out of the UK that members of parliament (MPs) have preferred leaving the EU with a deal than no deal.
Looking forward, China’s industrial production, retail sales and fixed asset investment can provide immediate guidance from the data front. Even if fixed asset investment (YTD) is likely to increase more than 5.9% prior to 6.0% on yearly basis in February, expected declines in industrial production to 5.5% from 5.7% and retail sales to 8.1% from 8.2% could dent the buying sentiment. China is among the top two buyers of the gold and any negative for the dragon nation can adversely affect the yellow metal prices.
Other than what’s already mentioned, progress on the trade talks between the US and China can also play their role to entertain Gold traders. Recently, the US lawmakers signaled that the negotiations are going through a critical phase before they can announce a final deal.
Gold Technical Analysis
Sustained trading beyond 50-day simple moving average (SMA) level of $1303.80 signal further upside to the present-month high near $1315.30 ahead of challenging $1318 and $1322.
Should the quote slip under 50-day SMA, $1300, $1295 and $1286 can please sellers.
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.
