Gold Daily Analysis – October 31, 2017

Gold prices continue to trade steady on Tuesday morning on the US dollar weakness. Investors speculate that President Donald Trump is likely to pick Federal Reserve Governor Jerome Powell to replace current Fed chair, Janet Yellen. Gold is trading at $1276.41, down 0.1% as of 9:30 GMT.

The Federal Reserve’s preferred inflation measure, the personal consumption expenditures (PCE) which is the price index excluding food and energy, rose 1.3% in the 12 months in September.

According to a report by the Commerce Department on Monday, Consumer spending, which accounts for more than two-thirds of U.S. economic activity, jumped 1% last month, the biggest since August 2009.

Technical view

Gold prices broke the resistance line at $1275 which is the first level of buying confirmation. However, prices still trade in a tight range which signals investors indecision. Traders expect central banks meeting, US Non-Farm Payrolls on Friday and Trump’s next Fed chair announcement. Resistance holds at $1285 which could be a trend reversal, in a case of a break. Support holds at $1265 and the market is likely to hit the resistance line at $1285. Once it breaks above the second level which is a strong bullish indication then the rally is expected to continue towards $1300. Alternatively, if it does not break, then the trend would still be negative and sideways movement is likely between $1265-$1285.