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Gold under pressure after sharp drop from $1300

Gold is trading sideways in the Monday session. In North American trade, the spot price for one ounce of gold is $1278.63, down 0.09% on the day. It’s a quiet start to the week, with no major releases out of the U.S. On Tuesday, the focus is on construction numbers, with the release building permits and housing starts.

Are we heading for a global trade war? The markets are certainly concerned after U.S President Trump imposed further tariffs on some $50 billion of Chinese products on Friday. China has promised to retaliate against U.S imports, as trade ties between the world’s two largest economies continue to deteriorate. With the U.S recently slapping tariffs on the EU, Mexico and Canada, it is no wonder that investor anxiety has risen.

Tariffs aside, trade negotiations on the NAFTA agreement remain deadlocked. Canada is deadset against a U.S demand for a sunset clause after five years, which would require the parties to hammer out a new agreement. As well, Mexico and Canada are not happy with U.S demands to raise the American content of any vehicle produced in any of the three countries, which would significantly alter the NAFTA auto pact. Mexico is holding general elections on July 1, and a left-wing candidate, Andrés Manuel López Obrador, leads in the polls. If  López Obrador becomes president, it could mean even more complications for the NAFTA talks.

XAU/USD Fundamentals

Monday (June 18)

Tuesday (June 19)

*All release times are DST

*Key events are in bold

 

XAU/USD for Monday, June 18, 2018

XAU/USD June 18 at 12:35 DST

Open: 1279.66 High: 1282.46 Low: 1277.88 Close: 1278.63

 

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1220 1236 1260 1285 1307 13322

XAU/USD showed little movement in the Asian and European sessions. The pair has posted small losses in North American trade

Further levels in both directions:

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]

Currency Analyst at Market Pulse [5]
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.
Kenny Fisher

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