Gold Prices Prediction – Gold Breaks Out on Hu Xijin Tweets
Gold prices moved higher as President Trump’s rhetoric lost some steam, following comments from Chinese newspaper editor Hu Xijin. The editor and chief of the Global Times called into question Trump announcement that China called and wants to come back to the table. President Trump called equity markets on Monday, which helped buoy riskier assets The Global Times is the official newspaper of the Communist Party of China. His Twitter account has started to rival President Trumps and is now having a similar effect on US markets.
Technical Analysis
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Technical Analysis
Gold prices surged breaking out and closing fresh 6-year highs. Gold appears to be following the rhetoric of President Trump. Short-term resistance is seen near $1,560. Support on the yellow metal is seen near the 10-day moving average at 1,514. Short term momentum has turned positive as the fast stochastic recently generated a crossover buy signal. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the black with a rising trajectory which points to higher prices.
China Can Tweet Too
After several days of whiplash statements about China that brought new tariffs, and bravado from President Trump eventually led by to a consolatory tone that trade negotiations are set to resume once more. Trump told reporters at the Group of Seven summit that the US and China had a very productive call, but this is now being called into question.
Additionally, Hu Xijin also said that China has been taking substantial measures to stimulate its economy. They want to move forward and rely less on trade with the United States. This information helped buoy gold prices as concerns that a trade war could continue permeated the markets.