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Gold Pushes Past $1300 After Trump Cancels Summit

Gold has steadied in the Friday session, after posting strong gains on Thursday. Currently, the spot price for one ounce of gold is $1306.01, up 0.09% on the day. On the release front, it’s a busy day. The focus is on durable goods reports, with expectations of mixed results. Core durable goods orders is expected to climb to 0.5%, but the markets are braced for a decline of 1.3% from durable good orders. If the indicator posts a sharp drop, gold prices could respond with gains. The US will also release UoM Consumer Sentiment, is expected to remain unchanged at 98.8 points.

Gold prices slipped close to one percent on Thursday, following reports that the summit between President Trump and North Korean leader Kim Jong-un had been canceled. Trump sent a letter to Kim, saying that he could not go ahead with the meeting, scheduled for June 12 in Singapore, after particularly harsh comments by the North Korean leader. For its part, Pyongyang was restrained in its response, saying that it still looked forward to resolving outstanding issues with the US. Rising tensions between the US and North Korea have rattled investors in recent months, boosting gold, which is a traditional safe-haven in times of crisis. If tensions worsen between the US and North Korea, investor risk appetite could wane and gold could be the big winner.

The Federal Reserve released the minutes from its May meeting. In the minutes, some Fed policymakers said they favored removing the phrase that “the stance of monetary policy remains accommodative”. Not surprisingly, the minutes didn’t shed light on the Fed’s plans, saying that another rate hike would occur “soon”, on the assumption that the US economy continues to perform as expected. Still, a quarter-point rate hike in August is virtually a given, with the CME Group setting the odds of a hike at 95 percent. This would mark a second hike in 2018. After that? The Fed projection remains at three rates hikes in 2018, but some analysts are predicting four increases this year.


XAU/USD Fundamentals

Friday (May 25)

*All release times are DST

*Key events are in bold


XAU/USD for Friday, May 25, 2018

XAU/USD May 25 at 7:25 DST

Open: 1304.87 High: 1306.73 Low: 1301.64 Close: 1306.01


XAU/USD Technical

S3 S2 S1 R1 R2 R3
1236 1260 1285 1307 1337 1375

Further levels in both directions:

OANDA’s Open Positions Ratio

XAU/USD ratio is showing slight movement towards short positions. Currently, long positions have a majority (68%), indicative of trader bias towards XAU/USD continuing to move to higher ground.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher [4]

Market Analyst at OANDA [5]
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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