Trade war reaches a resolution, is it the end for gold?On Friday’s closing of the global spot market, the gold price slides down again to US$1,467/troy ounce, declining by 0.18 percent compared to Thursday’s rate at US$1,470/troy ounce.
The incident was triggered by a comment from a U.S senator saying that the trade war between the U.S and China is reaching the end by the ongoing development of the “Phase One” negotiation.
During 2019, the gold price is having a good time thanks to the U.S – China trade war that rattles the global economy. The economic experts worried that if the trade war went on, it would slow down the global economy which would force the central banks all around the world to cut their benchmark interest rate.
Compared to gold, WallStreet reached its highest level after receiving the news from the U.S Secretary of Commerce, Wilbur Ross, who said that the “Phase One” negotiation between the U.S and China would continue on Friday. The news brought the gold price down from its throne for the recent week.
The other factor came from the Federal Reserve, or the Feds, stating that there would be no benchmark interest rate cut unless there would be significant “material” change in economic prospects in the future.
The short-term gold price is also suffering, reflected from its moving average 20; in other words, its price is beneath the average for the last 20 days.
Next week, the gold price might be corrected, but limitedly, due to the movement of gold price that has not reached its oversold according to the Relative Strength Index (RSI) indicator.
While the gold price is showing a downtrend, it might not be drastic since the price is moving sideways as shown in RSI.