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· Gold prices edged higher on Friday but traded in a tight range as investors stayed on the sidelines in the absence of news catalysts.

The metal, however, was on track to post its biggest weekly drop in two months, as a long awaited U.S.-China Phase 1 trade deal fuelled risk appetite.

Spot gold rose 0.2% to $1,555.14 per ounce by 0602 GMT, heading for a weekly drop of 0.4% - its biggest since the week ended Nov. 8.

U.S. gold futures rose 0.4% to $1,556.90.

· “Looks like we are just out of catalysts in the very near term. (Gold) prices are digesting recent volatility and are basically in a wait-and-see mode,” said Ilya Spivak, a senior currency strategist at DailyFx.

Meanwhile, data showed China’s economic growth slowed to its weakest in nearly 30 years in 2019 amid the trade war with the United States and sputtering investment.

· “This year we will see a bit more capital flows coming into gold, on the backdrop of weakening economy and geopolitical tensions,” said Brian Lan, managing director at dealer GoldSilver Central in Singapore.

The 18-month-long trade war between the world’s top two economies bruised the global economy and pushed gold prices 18% higher last year. Gold is considered a safe asset in times of political and economic uncertainty.

Financial markets received a slight reprieve after the announcement of the trade pact, although concerns about tariffs and unresolved core issues remained.

Weighing on gold, Asian shares rose after global stock indexes and Wall Street posted more records.

· Holdings of the world’s largest gold-backed exchange-traded fund SPDR Gold Trust rose 0.13% to 879.49 tonnes on Thursday.

· Gold Price Analysis: MACD offers bearish signal for first since November

A gold price indicator is offering a bearish signal for the first time in nearly two months.

The MACD histogram, an indicator used to identify trend changes and gauge trend strength, has crossed below zero, confirming a bearish reversal. The indicator was last seen printing negative values on Nov. 28.

Indicators tend to lag prices, therefore, traders can take the bearish reading on the MACD with a pinch of salt, especially since the price chart is flashing signs of bullish revival.

Gold could break above immediate resistance at $1,558 and challenge the lower high at $1,563. On the downside, key support is located at $1,536. At press time, the yellow metal is trading at $1,553 per Oz.

· Palladium soared 0.9% to $2,333.50 an ounce, after hitting a record high of $2,395.13 on Thursday, and was set for its biggest weekly gain since January 2017.

Platinum jumped 0.9% to $1,013.57, after hitting its highest since February 2017 at $1,041.05 in the previous session.

Silver advanced 0.5% to $18.02 per ounce.