Gold bounced back last night, trading higher in a range of $1294 - $1304.50.
It tripped some buy stops over $1297 (yesterday afternoon’s high), and $1300, but was capped by resistance at $1303-05 (former breakout from 6/15/18 top and prior 5 bottom support - 1/29, 2/7, 2/11, 2/13, and 2/14 lows).
The move was fueled by a pullback in the US dollar (DX from 96.79 – 96.59), which was pressured by some strength in the yuan (6.7293 – 6.7060, stronger Foreign Direct Investment), the euro ($1.1296 - $1.1329, stronger German Wholesale Price Index, Eurozone CPI as expected), and the pound ($1.3221 - $1.3278 – extremely choppy, markets digesting if lessening probability of no-deal Brexit outweighs uncertainty of the duration of Article 50 as May will now ask EU for delay).
Considerably firmer global stocks were a headwind for gold, with the NIKKEI up 0.8% (BOJ dovish – downgraded assessment of exports, factory output and global economy), the SCI rose 1%, European markets were up from 0.3% to 0.6%, and S&P futures were +0.4%.
Stocks were lifted by higher oil prices (WTI to $58.93 – fresh 4-month high) along with a report from the Chinese state media last night that the China’s Vice Premier Liu He spoke with Mnuchin and Lighthizer, and that US and Beijing were making “concrete progress” on the text of the trade agreement.
S&P futures firmed further ahead of the NY open (+14 to 2826), while the US 10-year bond yield moved up to 2.634%. The DX climbed to 96.76, and knocked gold back to $1301.
Misses on the US Empire State Manufacturing Index at 8:30 AM (3.7 vs. exp. 10) and Industrial Production (0.1% vs. exp. 0.4%) and Capacity Utilization (78.2% vs. exp. 78.5%) at 9:15 AM along...