Gold drops to $1,491 despite downbeat catalysts from Asia, Brexit uncertainty

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  • Gold ignores economic warnings from Australia, South Korea, and Japan.
  • Doubts over Brexit prevail, a lack of headlines concerning the US-China trade deal.
  • An active economic calendar, including ECB, will be the key.

Despite economic challenges from Asia and uncertainty surrounding the Brexit, Gold prices step back to $1,491 amid Asian session on Thursday.

Sluggish activity numbers from Australia and Japan join soft economic growth at South Korea to decorate Thursday’s Asian economic calendar.

On the news front, speculations mount for a general election in the United Kingdom (UK) while fears of an exit at the October 31 stay on card. It should also be noted that there was no major news concerning the US-China trade deal.

The US 10-year Treasury yields stay mostly unchanged around 1.76% following a mildly up closing of Wall Street.

Investors are now gearing up for an active day that comprising various Purchasing Manager Index (PMI) numbers from the European Union (EU) and the United States (US), coupled with the US Durable Goods Orders, New Home Sales, and Weekly Jobless Claims. However, major attention will be given to the European Central Bank’s (ECB) monetary policy decision as it will be the last for Mario Draghi as the President. The ECB isn’t expected to alter current monetary policy after announcing a heavy dose in the last meeting.

Technical Analysis

21-day Simple Moving Average (SMA) level of $1,493 seems to be the immediate upside barrier that holds the key to run-up towards a 50-day SMA level of $1,505. On the contrary, $1,477 and 100-day SMA level of $1,461 could question sellers.

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