Gold Price Prediction – Gold is Steady Ahead of Tariff Deadline

Gold prices moved higher but traded sideways on Thursday as market participants remain uncertain. President Trump was on the tape saying that he received a letter from Chinese President Xi on Wednesday and he is expected to speak to him by phone this week. Chinese trade negotiators came to the US, but are unlikely to make headway. Trump was also quoted on Wednesday saying that China has tried to renegotiate some of the trade deal, and this cannot go on. Trump is also speaking out of both sides of his mouth on this topic. He is saying that he wants a deal, but tariffs are good and he has no problem raising them come Friday at 12am.  The chances of something getting done on Thursday are unlikely but President Trump could extend the increase in the tariffs.

Technical Analysis

Gold prices moved higher trading sideways and unable to pierce through resistance near the 50-day moving average at 1,291. Support is seen near the 10-day moving average at 1,284. Short-term momentum is neutral as the fast stochastic moves sideways, which points to consolidation. Medium term momentum is positive as the MACD (moving average convergence divergence) histogram is printing in the black with a rising trajectory which points to higher prices.

Whole Sales Inflation Rose Less than Expected

US producer price index rose 0.2% in April, according to the labor department which means that inflation remains subdued. Expectation had been for a 0.3% gain. The increase in wholesale inflation over the past year was flat at 2.2%. Wholesale prices rose last month for gas and services. Wholesale food costs fell 0.2%. Core PPI, which excludes food and energy rose 0.4% last month. The yearly rate of increase in core prices increased to 2.2% from 2%. Additionally, US jobless claims rose more than expected climbing to 228K from 220K, according to the labor department.