“¢ A modest USD pullback/weaker US bond yields provide a minor lift.
“¢ Further escalation in the US-China trade tensions remained supportive.
“¢ All eyes remain glued to the upcoming release of FOMC meeting minutes.
Gold finally broke out of its daily consolidative range and was now seen building on the overnight goodish bounce from two-week lows.
A modest US Dollar pullback from one-month tops amid a sharp intraday slide in the US Treasury bond yields and turned out to be one of the key factors extending some support the dollar-denominated commodity. This coupled with a further escalation in the US-China trade tensions underpinned the precious metal’s safe-haven demand and remained supportive of the intraday positive move.
In the latest trade-related developments, the Trump administration was reported to blacklist Chinese surveillance technology firm – Hikvision and was also considering cutting off the flow of vital American technology to as many as five Chinese companies.
Meanwhile, the latest leg of an uptick since the early North-American session was further supported by news that the US Treasury Secretary Steven Mnuchin is not yet scheduled and has no plans to go to Beijing to resume the next round of trade negotiations.
This followed by comments from China’s foreign minister, saying that we will not accept unfair basis in talks with the US and will fight to the end if the US uses extreme pressure, further fueled worries about a full-blown trade war between the world’s two largest economies.
The uptick, however, lacked any strong bullish conviction as market participants now seemed reluctant to place aggressive bets ahead of the important release of the latest FOMC monetary policy meeting minutes, which might play an important role in determining the next leg of a directional move for the non-yielding yellow metal.
Technical levels to watch