Gold Shines on US Political Risk And Trade Uncertainty

The precious metal has gained over 2% against the Dollar since Monday and is positioned to push higher as Donald Trump’s impeachment concerns add to the bucket list of negative themes weighing on global sentiment. Given how Trump criticized China’s trade practices in a United Nation’s speech, optimism is wavering ahead of high-level trade talks in October. In regards to the technical picture, prices are trading above $1525. The daily close above this level should open a path towards $1545.

Oil

What goes up must come down. This was the story defining oil prices after initially exploding 20% higher last week Monday before surrendering almost all of its gains over a period of 7 trading days.

While the commodity’s valuation is set to be influenced by supply-side factors, demand-side concerns like rising US inventories, trade uncertainty and signs of slowing global growth will most likely cap upside gains. Should escalating trade tensions between the United States and China threaten global growth, this could translate to a drop in demand for Crude oil. So, while geopolitical tensions are seen triggering negative supply side shocks, this could be countered by falling demand.

Looking at the technical picture, WTI Oil can sink towards $55 if a daily close below $56 is achieved.

Silver

This could be a volatile trading week for Silver which continues to search for a fresh directional catalyst. Given how the precious metal remains correlated with Gold, prices are seen jumping higher if risk aversion boosts appetite for Gold.

Focusing on the technical picture, Silver is seen trading higher if $18.65 is conquered on the weekly timeframe. Should this point act as a gatekeeper and prevent further upside, then the next key point of interest for Silver will be $17.40 which remains a stubborn support.

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