- Gold prices shifting gears to the upside within a broadly bearish environment while below the 50-DMA.
- Trade deal progress continues to gain traction, but Brexit is still up in the air.
In the final hour of trade on Wall Street, spot gold was moving in on the 1490 level, trading higher by 0.22% having travelled between a low of $1480.91 and a high of $1489.04.
Gold for December delivery on Comex, on the other hand, lost around 60 cents, or 0.04%, to settle at $1,487.50 an ounce as investors remained indecisive over trade and Brexit progress.
Indeed, Gold caught a bid into the remaining hours of the US session following the outcome of the Brexit voting taking place on Tuesday. GBP dropped across the board as uncertainty prevails as the government was defeated on the timeline for the withdrawal agreement, opening prospects of an extension and a snap election. Boris Johnson will do his utmost to defend the 31st October date, but given the vote, he has very little choice but to ask for an extension - In any case, uncertainty os positive for the safe havens such as Gold.
The optimism of US President Donald Trump keeps trade deal hopes alive
Meanwhile, trade deal progress continues to gain traction, at least in the eyes of US President Donald Trump. Trump insists that there is a very high probability of a deal being signed as soon as next month as a meeting in Chile – “They have started the buying,” Trump said Monday during a Cabinet meeting at the White House, referring to Chinese purchases of U.S. agriculture products that the president has pushed for as part of a deal. “I want more,” he added.
Gold levels
Technically, the price is in familiar ranges and the bearish bias has hardly shifted on a 0.20% increase on the day. Instead, a 50% mean reversion of the late June swing lows to recent highs level around 1460/70 remains compelling. However, should the bulls break above the 50-DMA on a closing basis, then a subsequent advance beyond the psychological 1500 level ahead of the 1520 area will open prospects for a test back to the key 1535 resistance target.
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