FXTM information and reviews
FXTM
95%
OctaFX information and reviews
OctaFX
94%
XM information and reviews
XM
93%
FXCC information and reviews
FXCC
92%
FxPro information and reviews
FxPro
91%
HFM information and reviews
HFM
89%

Gold prices one to watch


21 March 2019

Gold prices have managed to achieve a rebound from the sub-$1,290 levels seen earlier this month to challenge $1,305 at the time of writing. What can be watched as a potential positive driver for Gold over the coming trading sessions is that risk-off sentiment appears to be creeping back into the markets, amid reports that China is pushing back against the United States in trade negotiations. The initial headlines making way in the early hours of Wednesday morning suggest that Chinese officials appear reluctant to cede ground on intellectual property policies and other data-related issues, until they’ve been assured that the Trump administration will lift tariffs on China.

Such reports underline the complexities of the ongoing negotiations between the world’s two largest economies, despite President Trump’s most recent comments that “talks with China are going very well”. Markets can expect several more twists and turns ahead in what has already been a long, drawn-out process, and this is still seen as potential fuel for safe-haven assets like Gold.

Investors do still hold on to optimism that a US-China trade deal can be signed by the end of April. There’s a clear impetus on both sides to secure a deal – Trump wants to boost his re-election chances heading into the 2020 Presidential campaign, while Chinese officials understandably want to focus on their own economic priorities.

For the time being, markets are expected to remain cautiously optimistic until a deal has actually been signed. The eventual conclusion to the long-standing trade tensions will hopefully help drive another round of risk-on sentiment for financial markets. The removal of trade tensions between the United States and China still remains as one of the best catalysts for improved emerging market sentiment and global stock market momentum, while it is also a leading factor to monitor heading into Q2 of 2019 for potential weakness in the US Dollar.

Dollar Discounts Dovish Fed


The US Dollar appears to be discounting the risk of a downbeat narrative being provided following the ongoing FOMC meeting. If this momentum for the Greenback remains intact, the Dollar Index will attempt to conclude a 3-day losing streak and rebound away from levels that have seen the Dollar hit its lowest level since the end of February.

It is considered by many as a foregone conclusion that the Fed will leave interest rates unchanged for a while, but investors want to know if the central bank will offer more guidance on the US monetary policy outlook for the remainder of the year. Markets will be keen to find out the latest readings on the Fed dot-plot, and whether they may justify the emergence of recent speculation that the Federal Reserve will consider cutting US interest rates down the road. I would be very surprised if this materialised, and expect the tone of the Federal Reserve once again to acknowledge that global economic conditions are weakening and that the US central bank is aware of the potential risks external headwinds are presenting to the global economy. This is the same narrative that has been provided by a wide range of different officials throughout the developed and emerging markets in the past couple of months.

There has been some recent softness in momentum through economic data releases from the United States, however the economy is overall performing with a level of resilience and I maintain my view that a US interest rate increase for later in 2019 is still on the table.

Share: Tweet this or Share on Facebook


Related

Gold traders appear hesitant
Gold traders appear hesitant

Gold finally broke out of the consolidation after being range bound for nearly 11 days. The correction to the downside was expected as gold traded in the overbought territory...

3 Feb 2023

Do safe haven currencies still exist?
Do safe haven currencies still exist?

At the end of last year, Swiss National Bank (SNB) President Thomas Jordan told news media that both the Swiss franc and the US dollar could be considered safe havens...

3 Feb 2023

USD Index appears bid and approaches 102.00 ahead of Payrolls
USD Index appears bid and approaches 102.00 ahead of Payrolls

The index looks to extend the post-ECB rebound. January Nonfarm Payrolls will take centre stage later. Other key data includes the ISM Non-Manufacturing...

3 Feb 2023

USD Index appears depressed post-Fed, breaches 101.00
USD Index appears depressed post-Fed, breaches 101.00

The index drops to 10-month lows near 100.80. The dollar remains on the defensive post-FOMC event. Initial Claims, Factory Orders next of note in the docket...

2 Feb 2023

Can The GER40 Keep Its Strength?
Can The GER40 Keep Its Strength?

As attention turns to the approaching Fed and ECB announcements, the GER40 index maintains stability near its best level since September last year...

2 Feb 2023

XAG/USD consolidates around 200-hour SMA, just above mid-$23.00s
XAG/USD consolidates around 200-hour SMA, just above mid-$23.00s

Silver stalls the overnight recovery move near the $23.70-80 support breakpoint. The technical setup warrants some caution before placing fresh directional bets...

1 Feb 2023


Editors' Picks

FXCM information and reviews
FXCM
87%
ActivTrades information and reviews
ActivTrades
86%
RoboForex information and reviews
RoboForex
85%
MultiBank Group information and reviews
MultiBank Group
84%
Libertex information and reviews
Libertex
83%
Vantage information and reviews
Vantage
83%

© 2006-2023 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.