With the USTR’s latest proposal to levy fresh tariffs on EU goods joining uncertainty surrounding Huawei’s future after the US-China trade truce, Gold prices recovered this morning towards the $1390 level. The US Trade Representative’s office proposed fresh tariffs on EU’s $4 billion worth of goods over the region’s aviation subsidies. Despite latest trade ceasefire between the US and China, the embattled Huawei is still to receive directions from the US Commerce Department and the same can renew tensions amid the world’s two largest economies. In addition to trade risk, the US and Iran tussle also gain market attention after the US President Donald Trump recently said that Iran is playing with fire while challenging them.
Gold prices are taking bids around the $1390 level this morning after dropping towards the $1382.76 support level during yesterday’s session. The price is currently trading just below the $1392.8 resistance level as the momentum bounced back a bit amid bearish pressure. We can notice that the recovery in prices is forming a flag pattern, therefor, we expect the price to reach the $1401.62 resistance level.
Support: 1382.76 / 1375.16
Resistance: 1392.8 / 1401.62