Gold Intraday: Will Trump Trigger an Upside Breakout for Gold?
George Lam May 29, 2020 11:53 AM
Spot gold has shown resilience over the past two trading sessions, and U.S. President will make an announcement regarding new policies on China later today...
Spot gold has shown resilience over the past two trading sessions, recouping most of its losses made on Tuesday, as there are growing signs of an escalation of U.S.-China political battle.
In answering a question on the phase one trade deal with China, U.S. President Donald Trump told reporters that he is "not happy with what has happened" and will make an announcement regarding new policies on China later today.
China state-run news agency, the Global Times commented that the "Hong Kong Battle" between China and the U.S. has already begun, and U.S. "sanctions are like bluffing less than half a bottle of beer".
In one of the worst case scenario, if Trump decides to terminate the phase one trade deal with China, it could be a catalyst for gold prices.
Technically, spot gold has not shown a clear upside breakout from the bearish channel drawn from May 18, as shown on the 1-hour chart. Nevertheless, a longer term rising trend line is still valid and a bullish morning star pattern has just formed on the daily-chart.
From a technical point of view, spot gold maintains a bullish bias above its nearest support at $1,705, with prices likely to test the 1st and 2nd resistance at $1,736 and $1,754. Alternatively, losing $1,705 might suggest the next support at $1,696 would be threatened.
Spot gold 1-hour chart:
Source: TradingView, Gain Capital
Spot gold daily chart:
Source: TradingView, Gain Capital
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.
Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.
Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.