Gold stays below 2-week-old resistance-line despite trade/political pessimism

  • Gold struggles to justify recent trade/political tension concerning the US, China and the Middle East.
  • The Bullion takes a U-turn from near-term falling resistance-line in search of a fresh direction.

Gold prices fail to portray the recent risk-aversion wave as they remain below near-term resistance-line while taking rounds to $1,513 on early Monday.

Renewed geopolitical tension between Saudi Arabia and Yemen has been a major driving force for markets’ immediate risk sentiment off-late. Following a threat from Houthi rebels, Saudi Arabia has also flashed signals of war if an attack takes place whereas the US deployed additional forces in the Middle East as a measure being “defensive in nature’.

On the other hand, Chinese delegates’ early leave from the US, without visiting the US farms, got a negative signal relating to the recently conducted trade negotiations in Washington. However, the US and Chinese media have been trying to cover the issue in order to (likely) avoid the bad start of the talks in October.

Also favoring the risk-off could be the continuation of an easy monetary policy wave from the global central bankers amid a lack of positive headline statistics and on-going trade uncertainty.

While risk-off sentiment dragged the equities and the US Treasury yields down, the Japanese Yen (JPY) and Gold have to bear the burden of the US Dollar’s (USD) sturdiness. It should also be noted that Autumnal Equinox Day holiday in Japan and a lack of fresh signal during the early Asian session also restricts the safe-haven’s upside.

Looking forward, traders could keep an eye over the preliminary activity numbers from the Eurozone and the US while also following the trade/political headlines for further direction.

Technical Analysis

Unless breaking a short-term descending resistance-line, at $1,517, prices are less likely to aim for September 04 low near $1,534 and the monthly top close to $1,557. As a result, $1,500 and $1,480 remain in the sellers’ watch-list for now.

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.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD consolidates around 1.1150 amid mixed trade headlines

EUR/USD is trading around 1.1150, consolidating previous gains. President Trump has expressed optimism about clinching a deal with China, while some officials have cast doubts. Brexit headlines are set to impact the euro as well.


GBP/USD hovers below 1.30 ahead of critical vote on the Brexit deal

GBP/USD is trading just below 1.30 as parliament is set to debate and vote on UK PM Johnson's Brexit deal. The vote on the program to complete the process quickly is also critical. 


USD/JPY: Firm above two-week-old rising trendline, 4H 50MA

With its U-turn from near-term key support confluence, USD/JPY flashes 108.65 as a quote during early Tuesday. Prices are likely to challenge monthly high surrounding 109.00 in order to challenge August month's top near 109.30.


Gold: Choppy inside monthly trendline, 200-bar SMA

Gold’s repeated failures to cross 200-bar Simple Moving Average (SMA) fails to portray the yellow metal’s weakness as the monthly trend line limits its downside. The Bullion presently tests the support line while flashing $1,483.55.

Gold News

Brexit drama does not deter the pound

Despite an unending series of Parliamentary setbacks for Prime Minister Boris Johnson’s attempt to clinch the UK exit from the European Union, Sterling has retained almost all of its gains of the past ten days, suggesting that his Brexit deal will eventually be approved.

Read more