The price action in the metals continues to show that traders are trying to push the metals higher, and investors over trade war fear. As we often talk about, investors triggered the demand for safe-haven assets at the time of uncertainty.
Earlier today, the precious metal gold prices fell to 1,274 despite intensified Sino-U.S. trade tension as investors didn’t find any solid reason to buy gold. However, gold has to break the $1,289 resistance first if it wants to get to $1,300.
What Expectedly Triggered Gold Buying?
Most of the buying triggered after the Bloomberg report that China has halted purchases of American soybeans in different chess move in the intensified trade war with the U.S. Well, the tension between the U.S. and China escalated further today after China’s state-owned newspaper People’s Daily warned the U.S. to not “underestimate China’s ability to strike back.”
Gold’s Technical Outlook
Well, we can see a doji candle on 3 hourly charts at 1,280. This extended reliable support to gold.
Gold also formed a bullish engulfing pattern right next to doji pattern, which signifies that bearish are exhausted and bulls are likely to enter the market.
In consequence to these technical factors, gold showed a dramatic surge and managed to violate 1,284 and 1,287 resistance areas. For the moment, gold is likely to close 3-hour candle below 1,292 resistance. This may offer us an opportunity to short the precious metal to target 1,286 today. So, let’s keep an eye on 1,292 as it can help us encash quick 40/50 pips during the U.S. session. All the best!