Gold awaits fresh clues to challenge $1520/18 support-confluence
- Gold stays above 10-DMA, 23.6% Fibonacci retracement despite a slump to the weekly low on Thursday.
- Expectations of US-China trade tussle slowdown recently dragged the bullion.
- A lack of fresh news, data holds prices at a little difference.
Following its slump to fresh weekly low, Gold remains mostly stable at around $1,528 during Asian morning on Friday.
China’s readiness to wait for September talks before exerting additional tariffs on the US products, initially scheduled for action on September 01, triggered initial risk-on during the previous day. Adding to gold’s weakness were the strengths of the US Dollar (USD) and Wall Street.
However, the official statement from China’s Customs Tariff Commission of the State Council mentions that imports from the United States (US) that appear more than once on China's tariff hike lists will be subject to the combined tariff rates. This means China’s action is not in good faith as a failure of September talks with the US will help it fight the case with a strong force.
Elsewhere, the US recently announced the launch of Space Command to counter threats from Russia and China whereas protesters in Hong Kong are still at unease after China’s power-show on Thursday.
Given the absence of major news and a lack of key data during the rest of the day, investors might keep their eyes on headlines for fresh impulse.
Technical Analysis
23.6% Fibonacci retracement of current month upside and 10-day simple moving average (DMA) highlights $1,520/18 as the key short-term support, a break of which can extend the latest pullback towards sub-$1,500 area. On the upside, $1,532/34 comprising August 13 high and Tuesday’s low seem nearby resistance ahead of monthly top surrounding $1,555.