- Gold prices look for fresh direction around the multi-week top.
- Commodities cheer broad USD weakness, expectations of further easing in Japan/China.
- Trade/political headlines to keep the driver’s seat amid the holiday-thinned trading session.
Gold prices take rounds to $1,511 amid the Asian session on Friday. The yellow metal has recently followed the foot-steps of a broad increase in the commodity basket while rising to the highest since November 04 on late-Thursday. The run-up could be attributed to the USD weakness. Also increasing the bullion’s strength could be likely an extension of easy money policy in China and Japan.
Nearness to the signing of the US-China phase-one deal and downbeat economics at home seem to have contributed to the greenback’s recent declines. The US President Donald Trump and Chinese diplomats have recently confirmed the signing of the much-awaited trade deal after months of drama surrounding it.
The US MBA Mortgage Applications and the four-week average of the Initial Jobless Claims are likely downbeat figures at the US economic calendar.
Further, comments from the Bank of Japan’s (BOJ) Governor Haruhiko Kuroda and headlines from China’s Global Times indicate a further increase in the Asian rush to fuel domestic liquidities. The same pushes traders towards the yellow metal in search of the store of value. Additionally, geopolitical tension between the US and North Korea, coupled with the US-Middle East sage, adds to the strength of the Bullion.
While the year-end sparse trading and a lack of major drivers may hinder market momentum, trade/political headlines are likely catalysts to be followed for fresh direction.
Technical Analysis
October month high surrounding $1,520 is likely immediate resistance for the gold buyers to watch ahead of targeting late-September tops near $1,535. Alternatively, $1,500 and 100-day Simple Moving Average (SMA) near $1,492 are likely nearby supports to watch during the price pullback.
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