Gold drops to 50-hour MA support as risk improves on US-China trade talks

• Gold shed $10 in the last few minutes and is now trading close to the 50-hour MA support at $1,542.
• A revival of US-China trade talks likely put a bid under riskier assets, weakening the bid tone around the safe-haven assets.

Gold is losing altitude, possibly due to renewed optimism on the US-China trade talks and the resulting demand for riskier assets.

As of writing, the yellow metal is trading very close to the 50-hour moving average support of $1,542, having dropped nearly by $10 in the last one hour or so.

Reuters reported earlier today that China’s Vice Premier Lie He held a phone call with the US Trade Representatives Lighthizer, US Treasury Secretary Mnuchin on Sept 5. and both sides agreed to hold trade talks in early October in Washington.

Riskier assets have responded positively to the revival of US-China trade talks with the futures on the S&P 500 index, a global benchmark for equities, rising more than 1 percent. in the FX markets, risk currencies like the AUD and the NZD are flashing green and the safe-haven JPY is under pressure.

Notably, the AUD/USD pair has jumped to 0.6823, the highest level since Aug. 1, despite the weaker-than-expected Australian trade surplus data.

So, it’s not surprising that the yellow metal is feeling the pull of gravity at press time. Gold prices may find acceptance below the 50-hour MA later today if the risk assets continue to gain altitude.

Pivot levels