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  • Gold prices have been under pressure again at the  critical $1500 level.  
  • US Dollar is taking the spotlight and catching a bid while solutions to trade war prospects disappear over the horizon.  

The value of gold prices have been under pressure again and testing the  $1500s to the downside. Gold spot currently trades at 1500 on the nose at the time of writing having travelled between a high of $1508 and $1487 the low on the day so far.  

The markets are concentrated on the value of the US Dollar, higher by 0.21% at the time of writing and holding its own as investors  look for value amidst uncertainty almost everywhere you turn, from Brexit, the Middle East, emerging markets, trade wars between the US/China and US/Europe as the main geopolitical risks simmering away.  

Gold, despite its safe-haven status, will struggle in an environment where investors continue to back the US dollar and dollar-denominated assets.  The trade talk sentiment, is, however, propping the precious metals up, so it is a bit of a tug-of-war between the value of the US Dollar and a flight to safety elsewhere.  

For instance, futures ended in positive territory, supported on such doubts over the US and Chinese trade negotiation delegation being able to resolve anything particularly significant this week when they are scheduled to meet later in the week. Also, US Producer Prices came in below par, -0.4% below expectations in fact for Year over Year – not the most positive prelude for this week’s Consumer Price Index.  

December Gold, subsequently, on Comex climbed $7.30, or 0.5%, at $1,511.70 an ounce, after shedding 0.6% on Monday while December Silver put on 25 cents, or 1.4%, to $17.79 an ounce, after losing 0.5% in the previous session.

Eyes on  Fed Chair Powell who will deliver remarks at the annual NABE Conference

Markets are now braced for  Fed Chair Powell who will deliver remarks at the annual NABE Conference at 2:30pm EST. We are going to be looking for clues regarding the path forward for rates. The topic of Powell’s discussion will be “Data Dependence in an Evolving Economy”.  

“The market is now priced in for an October cut on the heels of deteriorating data and will be looking for confirmation by the Fed Chair,” analysts at TD Securities explained.

Gold levels

Technically the bulls must stay above the  1500 psychological figure for an edge which will subsequently open up  1520 ahead of a 1535 resistance level. However, should the DXY crack YTD highs then  the bears can  traget a  break to below a 50% mean reversion of the late June swing lows to recent highs around 1460/70.