Trump – Xi Meeting Will Determine XAU/USD Direction

The gold price rallied the last hours as risk aversions traders turned to safe-haven assets. The upcoming meeting between the U.S. President Donald Trump and the People’s Republic of China President Xi Jinping, the two more powerful leaders in the world, spreads concerns to the market participants and weakens the U.S. dollar, favouring the gold’s price. In Euro area, French Presidential elections are due at the end of the month cause some uncertainty for the single currency.

XAU/USD – Technical Outlook

The yellow metal has been virtually unchanged since last week as it is developing within a narrow range with lower boundary the $1,240 support level and upper boundary the previous high at $1,260 level. Over the last sessions, the XAU/USD pair is trading above the three SMAs (50, 100 and 200 SMAs) on the daily chart while the 200-SMA acts as a significant support for the bulls. In a previous analysis, we recommended as first target $1,265 (see technical analysis here: Gold at 3-Week High As Investors Turn to Safe Haven Assets), however, if there is a successful attempt above the latter level we expect a run until the $1,308 strong barrier. Otherwise, a fall below $1,240 will expose the price at 100-daily SMA near $1,207.

In addition, the technical indicators have turned slightly lower, but are unable to confirm a downward breakout, yet. The RSI indicator is sloping to the upside in the positive path as well as the MACD oscillator is flattening above the zero line.


JFD Research