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Gold Takes Rangebound Movement in Response to Dollar’s Momentum

By:
Colin First
Published: Jul 26, 2018, 09:39 UTC

Gold prices have managed to survive the impact from the dollar strength and it continues to trade within a range

Gold

Gold price moved uptrend on early Thursday market hours as the dollar eased after U.S. President Donald Trump and European Commission President Jean-Claude Juncker agreed to work towards eliminating trade barriers, easing immediate concerns about global trade tensions. However in early European session gold saw all early gains erased as US dollar stood tall against the Chinese yuan amid a grim outlook for the world’s second-largest economy. Spot Gold XAUUSD saw intra high price hit at $1235.10 which is highest in more than a week and is currently trading at $1227.66 seeing 0.31% decrease in value. Simiarly Gold futures for august delivery are at $1227.60 down 0.34% after hitting an intra-day high of $1235.30 in early Asian market hours.Meeting between the EU President Juncker and President Trump in which they discussed moves to ease trade tensions led to some softening of the U.S. dollar index, which helped push up gold however the U.S.-China trade dispute which still remains unresolved and is the more challenging one weighed on Gold as China is a major player in gold and Chinese Yuan saw its value drop in late hours of Asian market session.
As of European market hours Spot Silver price is back to where it was during yesterday’s European market hours around $15.30 handle. Spot silver saw price action which was very similar to gold which moved up in late North American and early Asian hours but dropped in early European session on Thursday. XAGUSD pair hit an intra-day high of $15.69 and intra-day low of $15.25 moving mostly around $15.30/39 handle and as of writing this article is at $15.51 with 0.61% decrease in value. Dollar nominated precious metals are expected to continue dovish movement in today’s european market hours.

Gold Hourly
Gold Hourly

U.S. crude oil inventories declined in the week ending July 20, the U.S. Energy Information Administration (EIA) said in a report on Wednesday. According to the Weekly Petroleum Status Report, U.S. commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve (SPR), declined by 6.1 million barrels during the week. However Crude Oil price rose in early Asian market hours as Saudi Arabia suspended crude shipments through a strategic Red Sea shipping lane while US inventories fall to 3 ½ year lows. Brent crude futures had risen 42 cents, or 0.6 percent, to $74.35 a barrel by 0648 GMT, after gaining 0.7 percent on Wednesday. While U.S. West Texas Intermediate crude futures were up 5 cents at $69.35 a barrel, after climbing more than 1 percent in the previous session.

About the Author

Colin specializes in developing trading strategies and analyze financial instruments both technically and fundamentally. Colin holds a Bachelor of Engineering From Milwaukee University.

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