Gold dips as trade tensions ease following Juckner visit

Gold has posted losses in the Thursday session. In North American trade, the spot price for one ounce of gold is $1227.40, down 0.40% on the day. On the release front, durable goods reports rebounded in June but missed their estimates. Core Durable Goods Orders improved to 0.4%, shy of the estimate of 0.5%. Durable Goods Orders posted a gain of 1.0%, short of the estimate of 3.0%. Unemployment claims climbed to 217 thousand, above the estimate of 215 thousand. On Friday, the U.S releases Advance GDP and UoM Consumer Sentiment.

Trade tensions between the U.S and the European Union have dropped dramatically, which has sent gold prices lower on Thursday. EU Commission President Jean-Claude Juckner met with President Trump on Wednesday at the White House, and the meeting went better than expected. The parties announced that they had agreed to hold off on any further tariffs while talks are ongoing. This is a major concession from Trump, who had threatened to impose tariffs on European car imports. U.S tariffs on European aluminum and steel will remain in place, but Juckner pointed out that the U.S has agreed to reassess these measures. It’s still too early to call the trade war over, with negotiations over trade expected to be contentious. Still, market sentiment has improved, and if the Trump administration can reach agreements with China and with Canada and Mexico over NAFTA, risk appetite could rise and send gold prices downwards.

XAU/USD Fundamentals

Thursday (July 26)

• 8:30 US Core Durable Goods Orders. Estimate 0.5%. Actual 0.4%
• 8:30 US Durable Goods Orders. Estimate 3.0%. Actual 1.0%
• 8:30 US Unemployment Claims. Estimate 215K. Actual 217K
• 8:30 US Goods Trade Balance. Estimate -67.0B. Actual -68.3
• 8:30 US Preliminary Wholesale Inventories.  Estimate 0.5%. Actual 0.0%
• 10:30 US Natural Gas Storage. Estimate 39B. Actual 24B

Friday (July 27)

• 8:30 US Advance GDP. Estimate 4.1%
• 10:00 US Revised UoM Consumer Sentiment. Estimate 97.1

*All release times are DST

*Key events are in bold

XAU/USD for Thursday, July 26, 2018

XAU/USD July 26 at 12:05 DST

Open: 1232.31 High: 1235.30 Low: 1225.81 Close: 1227.47

XAU/USD Technical

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

• 1220 is providing support
• 1236 is the next resistance line
• Current range: 1220 to 1236

Further levels in both directions:

• Below: 1220, 1204 and 1170
• Above: 1236, 1260, 1285 and 1307

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