In September, the rates reached a peak and the rapid uptrend completely lost its intensity. In just two months, prices fell by 6.6% as a result of the formation of a sustainable demand for risky assets. Investors remain hopeful about a trade deal between China and the US.
This week, gold reached its lowest level in five months at $1450.77, but then began to recover under the influence of disappointing data on the growth rate of production output in China, in the absence of key reports on the US economy. The market receives daily positive signals on the negotiations between China and the United States, which at the same time do not contain any approximate date for signing the deal, nor any other specific details. Therefore, the failure of this round of negotiations also can't be excluded.
Based on the situation on the chart, we observe a high probability for the formation of a flat trend with a range of $1450.77 - $1553.8. At the same time, the rates in the near future may remain near the support line, but can then go up and reach the level of 1500+, though the annual maximum will likely not be reached.
Next week, the rates will remain under the influence of external factors, especially reports regarding the trade negotiations. Volatility will be low. We believe that in the short term, the deals to SELL will be efficient, but in the long term, the deals to BUY can be more profitable. The MACD and Stochastic oscillators indicate the effectiveness of the deals to BUY. The entry points to the market remain at the levels of $1450.77 and $1553.8, the breaking of which will signal a reversal or a continuation of the trend. Reaching the level of $1450.77 at the moment is considered the most likely.
