- Markets keep struggling with the US-China trade deal developments.
- US CPI, Powell’s testimony failed to provide any direction.
- Aussie employment, China’s data dump to decorate the Asian economic calendar before the key catalysts from the UK, EU and the US arrive.
Not only a lack of clear signal concerning the US-Sino trade deal but the inability of the global policymakers to provide any direct hints for future monetary actions also confuse markets. As a result, investors keep their faith in the Gold that is currently trading around $1,464 by the press time of early Asian morning on Thursday.
In contrast to the United States (US) President Donald Trump’s earlier statement that both sides are ‘close’ to the deal, the Wall Street Journal (WSJ) recently reported that the disagreement over China’s import of the US farm products hit the snag in the trade talks. Also adding to the uncertainty are the latest comments from China’s President Xi Jinping who indirectly criticized US trade protectionism.
Elsewhere, heads of the Reserve Bank of New Zealand (RBNZ) and the US Federal Reserve (Fed) kept repeating their previous statements that highlight the importance of incoming data. Further, headline inflation numbers from the Eurozone, the US and the UK also showed a mixed picture, which in turn contributed to the overall indecision and a rush towards risk-safety.
In doing so, the US 10-year Treasury yields dropped to sub-1.9% while equities also registered a sluggish trading session by the end of Wednesday.
Looking forward, October month employment data from Australia and Retail Sales/Industrial Production from China will gain the traders’ immediate attention. Following that will be the Gross Domestic Product (GDP) from the Eurozone, the United Kingdom’s (UK) Retail Sales and the second appearance of the Fed Chair Jerome Powell for testimony.
Although key data are anticipated to offer an active session ahead, trade headlines keep the drivers’ seat.
Technical Analysis
Prices now seesaw around 100-day Exponential Moving Average (EMA) level around $1,464. 21-day EMA level of 1,481 acts as immediate resistance while a downside break below the recent low of 1,445.80 highlights the importance of 200-day EMA level of 1,413.
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