Price of Gold Fundamental Daily Forecast – Traders Playing Waiting Game

Gold futures are edging higher on Tuesday following yesterday’s technical reversal top. The inside trading range suggests investor indecision and impending volatility. Traders are still waiting for further confirmation that tensions between the United States and China are easing, or if comments from government officials were just talk designed to calm down market volatility.

At 12:13 GMT, December Comex gold is trading $1541.60, up $4.40 or +0.28%.

On Sunday, Chinese Vice Premier Liu He, who has been leading the talks with Washington, said China was willing to resolve the dispute through “calm” negotiations and opposed any increases in trade tensions.

On Monday, U.S. President Donald Trump said he received a phone call from China in which the economic powerhouse expressed its desire to come back to the negotiation table. However, Beijing did not confirm reports of the phone call between the two sides.

In other news, uncertainty over the health of the global economy continued to underpin prices. This idea was supported by a report that showed Germany’s economy contracted on weaker exports in the second quarter.

Gold continues to be supported by the prospect of lower interest rates with traders pricing in a quarter-point cut in interest rates by the U.S. Federal Reserve next month, and over 100 basis points of easing by the end of the next year.

Daily Forecast

The next move in gold will be determined by whether China confirms or denies that the trade talks are back on. Today’s light trade and inactivity suggests traders are not betting heavily on either direction.

If China confirms Trump’s phone call then look for gold prices to weaken. Prices will fall further if both sides decide on a “cease fire”. This means no more new tariffs and no more retaliation for previous moves.

Gold will rally if trade tensions escalate. But right now, traders are just waiting for fresh news.