FXTM information and reviews
FXTM
95%
OctaFX information and reviews
OctaFX
94%
XM information and reviews
XM
93%
FXCC information and reviews
FXCC
92%
Libertex information and reviews
Libertex
91%
FxPro information and reviews
FxPro
90%

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:


Related

The Euro rebounded from the low
The Euro rebounded from the low

After updating its multi-year lows again, the major currency pair rebounded. The current quote for the instrument is 0.9656. Last night, the local interest in risks improved a bit, helping the asset to successfully correct...

29 Sep 2022

Gold Shows Signs of Life, But Heads Towards Another Losing Month
Gold Shows Signs of Life, But Heads Towards Another Losing Month

The precious metal is largely considered as a hedge to inflation, but it has not confirmed this status during the current year. It did kick it off with a rally, but as the Fed begun hiking rates back...

28 Sep 2022

Forex and Cryptocurrencies Forecast for September 26-30, 2022
Forex and Cryptocurrencies Forecast for September 26-30, 2022

Last week, all the attention of the markets was focused on the FOMC meeting of the US Federal Reserve, which took place on September 21. The probability of another rate hike by 75 basis points (bp)...

26 Sep 2022

Trading the SPDR S&P 500 ETF Trust
Trading the SPDR S&P 500 ETF Trust

The Standard & Poor’s (S&P) 500 Index measures the market capitalisation of the top 500 US largest corporations. Many traders and investors use the S&P 500 Index as a benchmark...

23 Sep 2022

Gold pauses as traders await Fed decision
Gold pauses as traders await Fed decision

The anticlimactic performance of gold continues as the prospect of aggressive rate hikes by central banks around the world amid heightened inflationary pressures...

21 Sep 2022

Developing a forex trading plan: All you need to know
Developing a forex trading plan: All you need to know

All forex traders have different backgrounds, market views, risk appetite, thought processes and expectations. Therefore, traders should not just blindly follow what other traders do...

20 Sep 2022


Editors' Picks

HFM information and reviews
HFM
89%
IronFX information and reviews
IronFX
88%
FXCM information and reviews
FXCM
87%
NordFX information and reviews
NordFX
85%
Vantage information and reviews
Vantage
84%
FP Markets information and reviews
FP Markets
81%

© 2006-2022 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.