Is gold preparing for further growth? Last week, we were confident that the rates will stay within the flat trend, in the range of 1448.57-1477.29 USD. We also believed that the negotiations between China and the United States are relatively successful and will put a strong pressure on gold.
But this week, prices rose sharply because of the statement of Donald Trump that it would be good if the trade deal with China is concluded after the US presidential election next year. This did not cause panic among investors, but still allowed gold to break through the resistance line and rush up for a certain time. However, the already ghostly perspective of a trade deal caused a wave of sales of risky assets.
The rise in gold prices was also helped by disappointing reports on business activity in the US in November. In addition, friction between the US and the EU is growing and can develop into another full-fledged trade conflict. Thus, gold received a powerful stimulus for growth, though it was not fully realized.
Today, the market is calmer and gold is losing in price, although investors have fewer reasons to be optimistic. A new round of negotiations between China and the US is on the verge of collapse, and macroeconomic reports on the US economy are not as strong as before. However, we believe that gold will not find enough stimulus for growth until the end of the week. The demand for risky assets will recover slightly. Still, in the medium term gold prices will be able to reach the level of 1500 + dollars, and the uptrend can be restored. Most technical analysis tools also tend to the deals to buy in medium-term trading.
