Gold Analysis 21.01.2019

Gold futures traded in a tight range slipping during the Asian session, negating the negative stability of the US dollar index, indicating a rebound to the second session of the highest since January 4 according to the inverse relationship between them following the developments and economic data that followed on the Chinese economy largest A global consumer of metals and the center of the absence of the US market due to the holiday celebration of Martin Luther King.

Gold futures for February delivery fell 0.11% to currently trade at $ 1,281.20 per ounce from the opening at $ 1,282.60 per ounce, while the US dollar index fell 0.03% to 96.31 compared to the opening at 96.34. .

We followed the National Bureau of Statistics (NBS) survey for China on a seasonally adjusted GDP forecast for the fourth quarter of 2018, which showed growth slowing to 1.5% in line with expectations versus 1.6% in the third quarter. Also with expectations compared to 6.5% in the previous annual reading for the third quarter to reflect the lowest growth rate since the first quarter of 2009.

In the same context, the annual reading of China's retail sales index for December showed an acceleration of growth to 8.2% compared to last November's previous forecast and expectations of 8.1%, and the annual reading of industrial production accelerated to 5.7% compared to 5.4% , Compared to expectations of 5.3%, in conjunction with the reading of unemployment rates, which increased to 4.9% compared to 4.8% in November.

Last week, China unveiled plans to boost spending by cutting taxes amid Beijing's pledge to step up efforts to boost growth, in conjunction with the People's Bank of China's work to maintain liquidity levels by injecting a record amount of money into the Chinese banking system through open market operations There, analysts predicted the continued expansion of China's stimulus during the coming period to combat the slowdown of economic growth.

Otherwise, we went on Saturday, US President Donald Trump said he had made progress toward a trade deal with China and denied thinking about raising tariffs. "Things are going well with China and with trade," he told reporters at the White House. Vice Premier Liu is the United States in the last two days of this month in the second round of trade talks between Washington and Beijing.

In the same context, we followed last Friday the report that China is making offers to get rid of the imbalance in the US trade, including a six-year round of purchases, increasing imports from America to more than $ 1 trillion, to reduce the trade surplus which reached last year $ 323 billion to zero by 2024, according to officials familiar with the negotiations told Bloomberg news agency with their students not to be named.

This came after the report on Thursday that US Treasury Secretary Stephen Manuchen discussed raising some or all tariffs on Chinese imports and working on a proposal to reverse tariffs in the second round of US trade talks, According to the Wall Street Journal citing people familiar with the internal deliberations.

"There is no discussion about raising tariffs now," US Treasury Department spokesman Emmons Javres told CNN on Thursday. The trade truce between Washington and Beijing expires in March and reflects developments. The current probability of the two parties reaching a trade agreement, which weighs on the performance of gold prices, which is a safe haven and alternative to investment with the transfer of liquidity to the stock markets.

Technical Analysis

The price of gold ended last week's trading below 1286.70, putting the price under negative pressure expected in the coming period, towards a possible test of 1262.50 level mainly.

Therefore, we expect the bearish bias to continue in the coming sessions, noting that breaching the 1286.70 level and stabilizing above it will reactivate the bullish scenario which has the next target at 1316.65.

For the indicators, we see that the price is trading below the moving average 7 where the price of this average burned, while the average move 20 resistance to the price and stopped the decline last Friday and opened today below this average so we can see more deflation in the price movement as long as the price Under this line.

Stochstic removed from the neutrality that was moving and its direction and headed towards the oversold area to increase the negative pressure on the price movement.

The trading range for today is among the support at 1260.00 and resistance at 1295.00

Support:

Support: 1286.83-1262.50-1251.00

Resistance: 1293.00-1301.00-1318.00

The general trend for today is bearish