Gold rallies to $1516 as stocks and bond yields plunge on China’s trade negotiators cutting trip short - Gold Today September 20, 2019
Jim Pogoda, Senior Gold Trader, Gold Bullion International
Overnight –choppy trade between $1498 - $1507
· Gold was a little choppy last night, trading in a range of $1498 - $1507.
· It climbed to its $1507 during Asian and early European hours, taking out resistance at yesterday’s $1504 high, but was capped by the down trendline from the 9/4 $1557 high.
· The move was fueled by a decline in the US 10 year bond yield (1.794% - 1.76%) along with a softer US dollar (DX from 98.38 – 98.14).
· The dollar was pressured by a firmer yen (108.09 – 107.74, stronger Japanese Core CPI), euro ($1.1038 - $1.1068), and pound ($1.2520 - $1.2580, EU’s Juncker’s openness toward alternative solutions to the Irish backstop yesterday still resonating).
· Gold also benefitted from a surprise cut in India’s corporate tax rate.
· Later during European time, gold slipped back to $1499, fading strength in S&P futures (+8 to 3016), which were helped by news the US was temporarily exempting more than 400 types of Chinese products from tariffs that the Trump Administration had imposed last year.
· A rebound in the US 10-year bond yield (1.793%) and US dollar (DX to 98.49) also weighed on the yellow metal.
· The greenback was helped by a decline in the euro ($1.1026) from a weaker German PPI report and the pound ($1.2476) from comments from the EU’s Chief...