Gold jumps as dollar slips after Trump-Xi meeting

Gold has posted strong gains in the Monday session. In North American trade, the spot price for one ounce of gold is $1234.27, up 1.02% on the day. On the release front, the ISM Manufacturing PMI improved to 59.3, above the forecast of 57.5 points.

The U.S dollar has broadly retreated on Monday, and gold has taken advantage and climbed to its highest level since November 7. The dollar fell as risk appetite improved following a truce in the trade war between the U.S. and China. The de-escalation follows a crucial meeting between President Trump and Chinese President Xi Jinping at the G-20 summit on Saturday. Investors paid scant attention to the discussions between world leaders, focusing instead on a weekend dinner meeting between President Trump and Chinese  President Xi Jinping. Just last week, Trump had threatened to raise tariffs on $200 billion in Chinese products from 10 percent to 25 percent on January 1. However, the tone was optimistic after the meeting, with China receiving a short reprieve. The sides have agreed to continue talks for another 90 days, and the U.S. tariffs will take effect if no agreement is reached. At the same time, the U.S. and China remain far apart on resolving the trade war, and the greenback will likely reverse directions unless the parties make substantial progress in the trade dispute, which has shaken the markets and threatens to derail global growth.

XAU/USD Fundamentals

Monday (December 3)

  • 6:30 US FOMC Member Clarida Speaks
  • 8:00 US FOMC Member Quarles Speaks
  • 9:15 US FOMC Member Williams Speaks
  • 9:45 US Final Manufacturing PMI. Estimate 55.4. Actual 55.3
  • 10:00 US ISM Manufacturing PMI. Estimate 57.5. Actual 59.3
  • 10:00 US Construction Spending. Estimate 0.4%. Actual -0.1%
  • 10:00 US ISM Manufacturing Prices. Estimate 70.1. Actual 60.7
  • All Day – US Total Vehicle Sales. Estimate 17.3M
  • 10:30 US FOMC Member Brainard Speaks

*All release times are EST

*Key events are in bold

XAU/USD for Monday, December 3, 2018

XAU/USD December 3 at 12:05 EST

Open: 1221.83 High: 1235.03 Low: 1221.38 Close: 1234.34

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1170 1204 1220 1236 1261 1284

XAU/USD posted considerable gains in the Asian and European sessions. The pair continues to climb 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, 1170 and 1146
  • Above: 1236, 1261 and 1284

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

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