The precious metal gold prices fell below the $1,400 level due to a trade patch up between the U.S. and China, increasing risk appetite. The safe-haven gold prices traded flat after Trump’s announcement but recovered lightly today. On Tuesday, the gold futures for August delivery traded at $1,391.95 a troy ounce, losing -0.15% for the day.
The president of the U.S. and the leader of China agreed to continue trade talks after Donald Trump assured that he will not impose a new tariff on Chinese goods and will also reduce limitations on Huawei tech company, easing tensions with China.
Meanwhile, China agreed to make further purchases of U.S. farm products and to return to the meeting table. Trump said mediators from both sides are talking very much on the phone and that trade meetings have already begun and actually began prior to the meeting. Trump was speaking on his meeting with Xi Jinping.
Gold – Technical Outlook
On the technical front, gold has completed 50% retracement around $1,384, exactly as we forecasted in our previous updates entitled “Gold Drop Ahead of G20 Meeting – Fibonacci Retracement In Play“.
Key Trading Level: 1388.48
At the moment, gold is trading below 20, 25 and 50 periods EMA which are providing significant resistance around $1,395/98. The same levels are shared by 38.2% Fibo resistance.
Gold – TradingTips
Consider staying bearish below $1,395 as gold has the potential to drop further until $1,385 and $1,372. All the best!