At the moment there is a slight risk-on with equities markets, despite this, investors are buying the dip on Gold, perhaps as a way to diversify for a potential downside to risky assets such as equities, properties, commodities. There is a constant pressure caused by trade concerns that is potentially limiting the gains. The price is waiting for a fundamental driver, and we can clearly see the range bound market at this point. Yesterday, there was no news that could have moved the USD, so the Gold remained relatively calm. Today again, there will be no major news for the USD, so the price could still be range bound. Tomorrow will be another story as there are a lot of data releases that might move the Gold market, such as Building Permits and Crude Oil inventories.
Technically, Gold is trapped between two trend lines with clear highs and lows that pinpoint the current range bound market. Any fundamental driver for the USD or eventually EUR could break above or below, signalling the potential move. Traders should be focused on breakouts now. If we take a look at Admiral Correlation Trader add-on, we can see a positive correlation between the EURUSD and Gold. A move above 1212 could target 1220 and eventually 1233, while the move below 1187 should be aiming for 1180 and 1173.
Short Pivot Lines – Daily Support and Resistance
Long Pivot Lines – Weekly Support and Resistance
POC – POC – Point Of Confluence (The zone where we expect the price to react – aka the entry zone)
