Gold on the bids around $1342 as risk-off intensifies

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  • Doubts over global growth amid trade wars/geopolitical challenges grab market attention ahead of Wednesday’s FOMC.
  • Comments from global central bankers and second-tier data may direct intermediate moves.

Pre-established risk-off moves gained additional support from downbeat comments by the Bank of Japan (BOJ) Governor Haruhiko Kuroda and sluggish housing data from Australia/China during early Tuesday. As a result, Gold prices rise to $1341.90 ahead of the European session.

Not only fewer chances of the US-China trade deal at the upcoming G20 but the increasing tussle between the US and Iran also carried the risk-aversion forward at the day’s start.

The US Commerce Secretary Wilbur Ross recently turned down chances of any breakthrough from the meeting between the US President Donald Trump and his Chinese counterpart at the sidelines of G20.

Elsewhere, the US added 1,000 troops to its Middle East forces amid expectations of Iran taking steps to retaliate against recent allegation over Oman attacks.

The global benchmark for risk sentiment, the US 10-year treasury yield holds the latest losses to 2.086% by the press time.

Moving on, comments from the global policymakers at the European Central Bank’s (ECB) Forum in Sintra will be closely analyzed for fresh impulse ahead of tomorrow’s FOMC.

Adding to the watching could be housing market numbers from the US and political noises surrounding the UK, trade, and geopolitics.

Technical Analysis

While year to date high surrounding $1358 holds the gate for the bullion’s rally towards early-2018 tops near $1366, its further upside might not refrain from calling 2016 high of $1375.27 back on the chart. Though, metal’s decline below March month high of $1327.80 can trigger fresh selling pressure targeting $1310 and $1300 round-figure.

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