- Gold fails to carry recent upside amid the USD strength.
- The US arrests Chinese government employee for visa fraud.
- No fresh news from Saudi Arabia.
With fewer catalysts to rely on, Gold prices trade near $1,497 during Tuesday’s Asian session.
The yellow metal benefited from the drone attack on Saudi Arabian oil facilities that destroyed the oil-rich nation’s 50% output. However, the gains were confined due to the US Dollar’s (USD) rally backed by recently positive sentiment surrounding the world’s largest economy.
The US alleges Iran for the attacks on Saudi Arabia while Tehran denies the same. Reuters reported that Saudi Arabia is to invite experts from the United Nations (UN) to investigate the incident.
The US Depart of Justice (DOJ) recently arrested a Chinese government employee for alleged visa fraud. The same could negatively hurt the US-China relationships ahead of the October trade meeting. Both the economies have been undertaking goodwill gestures to ease trade-war concerns off-late.
It should also be noted that investors await key monetary policy meeting decision from the US Federal Reserve, up for Wednesday, in order to determine near-term market moves.
As a result, risk-off portrayed by the US 10-year treasury yield’s extended declines to 1.831% seems to cause fewer damages to the safe-haven.
Given the absence of fresh catalysts and the sustained greenback strength, the bullion remains under pressure during the Asian session while seeking clues from trade/political frontiers.
Technical Analysis
The 21-day simple moving average (SMA), at $1,515, restricts the yellow metal’s upside towards monthly tops surrounding $1,557. As a result, a downside break of 50-day SMA level of $1,478 could trigger fresh south-run to July month high near $1,452.
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