• The positive news over US-China trade war and a strong US Dollar both keep gold under pressure on Monday.
  • Gold is capped at the 1290.00 level in the American session.

Gold is trading at around $1288.55 a troy ounce on Monday.

In Asia, gold fell from the 1292.00 area to find an intraday floor at 1281.70 in early Europe. The metal then rebounded and is trading now in the 1288.00 area.

Both positive news on trade and a strong US Dollar keep gold on the back foot on Monday.

On Saturday, the US and China had constructive talks over the trade war dispute. Steven Mnuchin, US Treasury Secretary’s recent positive comments saw the markets enter in the risk-on mood on Monday. As gold is seen as a safe-haven asset, investors sold the metal in favor of more risky assets such as stocks. 

Indeed, Mnuchin said: “we are putting the trade war on hold. Right now, we have agreed to put the tariffs on hold while we try to execute the framework,” 

It has also been reported that China would import more agricultural commodities and energy from the US in order to narrow the $335 billion annual US goods and services trade deficit with China.

Both countries agreed that reaching a consensus was of mutual benefit for both parties. “China has never hoped for any tensions between China and the United States, in the trade or other areas,” said Chinese foreign ministry spokesman, Lu Kang while Vice Premier Liu He said the talks were “positive, pragmatic, constructive and productive”.

Goldman Sachs analysts argue that “we do not rule out the possibility that the Chinese team offered some tangible concessions which helped the progress of the talks, but as other aspects of an agreement are still in flux, has avoided stating these offers in public,” as the Bank wrote in a research note.

Meanwhile, the US Dollar Index (DXY) which is largely inversely correlated to gold has found an intraday floor at 93.66 and is still trading at multi-week high. 

Gold 4-hour chart

The main trend is bearish as the market is trading below its 50, 100 and 200-period simple moving averages on the 4-hour chart. Supports are seen at the 1281.70 swing low and at 1270.00 figure while resistances are seen at the1290.00 psychological level 1296.92 and at 1300.00 figure.

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

AUD/USD: China, Fedspeak probe bulls near 0.7100, Aussie inflation expectations eyed

AUD/USD: China, Fedspeak probe bulls near 0.7100, Aussie inflation expectations eyed

AUD/USD treads water around 0.7080, after rallying to the fresh two-month high, as the recent Fedspeak and headlines surrounding the China tariffs seemed to have poked the bulls. The Aussie pair traders remain cautious ahead of the monthly Consumer Inflation Expectations from Australia.

AUD/USD News

EUR/USD defends US inflation-inspired gains near 1.0300 at one-month high

EUR/USD defends US inflation-inspired gains near 1.0300 at one-month high

EUR/USD flirts with the 1.0300 threshold, after posting the biggest daily gains to refresh five-week high, as traders reassess the risk profile during early Thursday morning in Europe. The reduction in the US inflation numbers propelled hopes that Fed could ease on its rate hike trajectory.

EUR/USD News

Gold extends recovery towards $1,800 as hawkish Fed bets trim

Gold extends recovery towards $1,800 as hawkish Fed bets trim

Gold price has picked bids below $1,790.00 and is extending its recovery above the immediate hurdle of $1,792.00 amid a broader risk-on in the global market. The precious metal is expected to continue its upside run-up after a healthy correction to near $1,808.00.

Gold News

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: How to trap a hungry bear

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: How to trap a hungry bear

Crypto markets moves higher. Placing a countertrend short is still ill-advised. Higher targets remain possible for all assets. BTC tests the lower half of an ascending channel for the third time. ETH continues displaying bearish divergence but underline market strength remains. XRP in a make-or-break situation.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures