Gold prices giving up 0.30% at $1,509.52 after the previous week, Fed cut its interest rate for the third time in a row this year. Wilbur Ross, US Commerce Secretary, expressed optimism that China and US would reach a “phase one” trade deal in November. Reports show that ETF holdings backed by gold hit the highest since 2013 after posting a rise the previous week. The stockpile has risen every week since August, apart from a single weekly drop-in mid- September.
U.S. Gross Domestic Product for Q3 expanded at a 1.9%, slowing from 2% in the Q2 but came in above market forecasts for growth of 1.6%. The ECB kept interest rates unchanged and continued its bond repurchase program of €20billion per month.
The gold price tested the support from the ascending trendline at $1,483 last week and managed to breach the 20-day moving average first then the 1,500 mark and finally the 50-day moving average giving the bulls the upper hand. On the upside, first resistance would be met at $1,513.98 today’s top while a move above will open the way for a move up to 1,5017.91 the high from October 25th.
On the downside, first support for gold now stands at $1,508.50 today’s session low and then at $1.500 round figure, a close below that support line might have negative implications and might attract more offers that will drive the price down to $1,495.51 the 20-day moving average. Gold has established strong support at $1,458 October low. The precious metal remains well supported by weak global economic data, low-interest rates environment and tensions in Syria and Middle East.Download our latest quarterly market outlookfor our longer-term trade ideas.
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