- Gold fails to hold on to recovery gains amid the latest risk-on.
- Brexit/trade headlines have been positive during the weekend.
- Key Brexit developments, Fed meeting and the US jobs report will be in the spotlight.
With the latest macro supporting market’s risk sentiment, Gold prices decline to $1,503 amid Asian session on Monday.
The quote surged to the highest in four weeks on Friday but fails to remain strong as weekend news concerning the Brexit and the US-China trade negotiations weigh on the yellow metal’s safe-haven demand.
Among them, the Brexit front seems nearer to the European Union’s (EU) assent to a three-month extension to January 31, 2020, as per The Guardian. On the other hand, Reuters report that trade negotiations between the United States (US) and China have been going smooth with the recent phone call claiming “close to finalizing” part of Phase One deal. Furthermore, the US announced the killing of the Islamic State of Iraq and the Levant (ISIS) leader Abu Bakr al-Baghdadi and eased some more of the geopolitical tension.
In a reaction to all these risk-supportive news, the US 10-year treasury yields stop the previous declines and recovery to 1.80% by the time of writing, which in turn pushes the yellow metal buyers to lock some profits.
However, Goldman Sachs holds its six-month forecast of $1,600 amid expectations of precautionary holding of cash to increase due to the trade war, central bank support, and a fall in funding cost.
Moving on, traders are likely to remain risk-averse considering the presence of the key events during the week. Among them, Brexit headlines concerning the voting on the British Prime Minister’s (PM) proposal for a snap election and the US Federal Reserve’s monetary policy meeting, not to forget about the United States’ (US) monthly jobs report, will be crucial to follow.
Technical Analysis
While a sustained break beyond $1,520 becomes necessary for the Bullion to revisit $1,535 and September month high of $1,557, a downside break of a rising trend line since early-August, at $1,478, will recall sellers targeting $1,450 level.
Share
