· Gold prices were little changed on Wednesday as mixed messages on the U.S-China trade deal countered positive economic data out of the United States.
Spot gold was trading at $1,475.55 per ounce by 0118 GMT. U.S. gold futures were flat at $1,480.20.
· U.S. manufacturing production rebounded strongly in November, while housing numbers rose higher than expected and permits for future home construction soared to a 12-1/2-year high.
· Asian shares held close to 18-month highs as markets reacted to positive U.S. economic data, while the dollar hovered near a one-week high against a basket of currencies.
· On the trade front, U.S. Trade Representative Robert Lighthizer on Tuesday said details of Chinese purchases across U.S. agriculture, manufacturing, energy and service sectors in the “phase one” deal would be detailed in writing, but gave no further details about when the written agreement would be released.
· The 17-month-long tariff war and its impact on the global economy have pushed the safe-haven gold up about 15% so far this year.
Washington is set to implement five rules to limit exports of sophisticated technology to adversaries like China.
· More Federal Reserve policymakers upheld the central bank’s stance on leaving interest rates steady on Tuesday and said the bar to cutting or raising them would be high.
Lower interest rates reduce the opportunity cost of holding bullion and weigh on the dollar.
· Holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, fell 0.63% to 880.66 tonnes on Tuesday from Monday.
· Elsewhere, palladium slipped 0.7% to $1,942.11 an ounce. Prices hit an all-time peak of $1,998.43 in the previous session.
· Silver was down 0.1% to $16.98 per ounce, while platinum fell 0.2% to $925.51.
· The precious metals complex is trading fractionally lower today as U.S. equities continue to rise. Given that US equities are only fractionally higher gold, silver and platinum are all trading fractionally lower. This all-in light of dollar strength providing some headwinds to any potential gain.
Gold continues to struggle and has been trading in a tight and narrow range. Since November 4, gold futures have been unable to trade above the 50-day moving average. Most importantly, since December 3 the precious yellow metal has traded above that average on four occasions. But those four attempts resulted in gold closing below the average. The last two trading days resulted in two of those attempts, where gold was unsuccessful in closing above this key indicator of short-term trend. Add to that decreasing daily volume as we approach the holiday season.
MarketWatch spoke to Chintan Karnani, chief market analyst at Insignia Consultants where he said, “Despite the modest moves Tuesday, overall the trend in gold, silver, copper, and the U.S. dollar index around Christmas and New Year’s Day “should be taken seriously. Lack of trading volumes or thin-markets reasoning can cause short term trading losses and short-term investment losses.”
He also warned that “If gold does not break $1,500 this week, then there will be profit booking on long positions.”
On a technical basis the compressed range which contains a series of lower highs, and higher lows since September 3 when gold reached this year’s high of $1565 has created a bullish flag or pennant formation.
Reference: Reuter, FXStreet,Trading View
Thai
Eng