- Fading US-China trade optimism provided a goodish lift on Tuesday.
- Bulls lacked any strong conviction ahead of FOMC meeting minutes.
Gold was seen oscillating in a narrow trading band through the early European session on Wednesday and consolidated the overnight goodish move up back closer to weekly tops.
Renewed uncertainties surrounding the US-trade talks, together with negative Brexit headlines dented investors' appetite for riskier assets on Tuesday. The same was evident from a selloff in the US equity markets and provided a strong boost to traditional safe-haven assets - like Gold.
Reviving safe-haven demand supportive
The precious metal quickly reversed an early dip to multi-day lows and rallied back above the key $1500 psychological mark in reaction to the US decision to blacklist eight Chinese companies over the treatment of Muslim minorities in the western province of Xinjiang.
Meanwhile, a South China Morning Post report said on Tuesday that China had toned down expectations ahead of high-level trade talks between the two countries, starting this Thursday, and further added that the Chinese delegation could depart Washington a day earlier than scheduled.
The latest development threatened to derail already delicate trade negotiations and dampened the global risk sentiment. The global flight to safety was further reinforced by a sharp slide in the US Treasury bond yields, which further benefitted and drove flows towards the non-yielding yellow metal.
Meanwhile, a subdued US Dollar price action did little to influence the price action on Wednesday, though bulls lacked any strong conviction and seemed reluctant to place any aggressive bets ahead of the release of the minutes of the latest FOMC policy meeting held on September 17-18.
Ahead of the key event risk, a scheduled speech by the Fed Chair Jerome Powell will be looked upon for some short-term trading impetus later during the early North-American session, making it prudent to wait for a strong follow-through buying before positioning for any further near-term appreciating move.
Technical levels to watch
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD loses traction, retreats below 1.0600
EUR/USD lost its recovery momentum and declined below 1.0600 in the American session on Friday, erasing a portion of its daily gains in the process. Nevertheless, the risk-positive market atmosphere after PCE inflation data helps the pair limit its losses.
GBP/USD turns negative on the day below 1.2200
GBP/USD reversed its direction and slumped below 1.2200 in the American session on Friday after rising above 1.2270 earlier in the day. Position readjustments and profit-taking on the last trading day of the quarter seems to be weighing on Pound Sterling.
Gold reverses direction, drops below $1,860
Following a steady rebound toward $1,880 on Friday, Gold price made a sharp U-turn and turned negative on the day near $1,860. Although the 10-year US T-bond yield is down more than 1%, XAU/USD struggles to find demand on the last day of Q3.
Polkadot Price Forecast: DOT reversal seems inevitable after 92% correction from all-time high
Polkadot price, in nearly two years, has shed 92.91% from its all-time high of $55.09. The massive downswing in DOT has pushed it down to levels that were last seen in October 2020. Hence, the chances of this altcoin forming a bottom and rallying are high.
Earnings beat triggers Nike to spike 9%
Nike (NKE) stock has surged over 9% in Friday’s premarket, climbing above $98 per share, following late Thursday’s fiscal first-quarter earnings release. Nike beat pessimistic earnings expectations by more than 23% and hiked its dividend by 9%.