GOLD LOOKING MIXED/BEARISH AMID TRADE WAR
Gold was trading flat on Thursday after two sessions of gains, as a stronger dollar index weighed on upside momentum, though the metal took some comfort from a steadier yuan. The metal has added 0.41% over the previous two trading sessions. Gold has been highly correlated with the Chinese yuan in recent times, with the Chinese currency acting as a proxy for concerns about Sino-U.S. trade tensions. A strong dollar makes gold costlier for non-U.S investors.
Gold has largely failed to benefit from the rising geopolitical tensions this year, as investors have chosen the safety of the dollar over the yellow metal. According to market sources Gold could move higher, later in the the year, because the dollar could weaken a bit, due to possible Chinese government efforts to stabilize the weakening Yuan. Holdings in the SPDR Gold Trust fell 0.18% to 786.08 tonnes on Wednesday, hitting the lowest since August 2017. Silver and WTI Crude were also trading flat on Thursday.
On the technical front, the RSI is currently at 38.32% and suggests that the market can continue trading sideways. The %K has crossed the % D from below to the upside at 28.85%, and this suggests that the market may head upwards. The price is below the middle line of the Bollinger bands and is going downwards. So, overall the market setup seems to be mixed to negative.
Trade Suggestion-Sell At: 1216, Take Profit At: 1212 Stop Loss At: 1218