- Gold prices gradually recover from the intraday low.
- US President Trump cites an intelligence report suggesting China’s mishandling of virus outbreak, threatens to end the trade deal.
- Concerns surrounding additional stimulus from the US, New Zealand act as the latest catalysts.
- A light economic calendar keeps virus/trade headlines on the driver’s seat.
Gold prices failed to extend the uptick beyond $1,700 while taking rounds at $1,698, down 0.10% on a day, in early Monday’s trading. It should be noted that the bullion slipped to $1,692.30 during the early-Asian session amid broad risk-off sentiment.
While good news from Gilead seems to have eased the coronavirus (COVID-19) fears at the start of the week, the Trump administration’s criticism of China’s mishandling of the virus outbreak weighed on the risk tone.
Having earlier said to cheer his allegations over the dragon nation, backed by the intelligence report, US President Donald Trump recently threatened to end the trade deal with China if it fails to purchase US goods.
Although China terms the accusations as a bluff to fool the US voters, US S&P 500 Futures drop over 1.0% to 2,792 by the press time.
The recent catalysts for financial markets are in the form of hints suggesting additional stimulus from the US, not to forget the downbeat survey from the Australian Bureau of Statistics (ABS).
It should, however, be noted that the absence of Chinese and Japanese traders seems to restrict the yellow metal’s reaction to the risk-off sentiment.
Looking forward, traders will need to keep eyes on the US-China trade/virus updates for near-term direction.
An upside clearance of 100 and 200-HMAs, respectively near $1,702 and $1,708, becomes necessary for the escalation of the recent recovery moves towards short-term resistance line, at $1,717 now. On the downside, 61.8% Fibonacci retracement of April 21-23 upside, near $1,691 and Friday’s low near $1,670 could lure the bears.
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.