Sunday, 18 August 2019 10:30 GMT

Gold Prices Eye German GDP Data, Chart Setup Warns of Topping

(MENAFN - DailyFX)

GOLD & CRUDE OIL TALKING POINTS:Gold prices down as White House waters down China import tariff hike Crude oil pricesgain in risk-on trade but trend resistance still in place Soft German GDP data may revive global slowdown fears, EIA data due

Gold prices ended a volatile day with a loss as the White Housewatered down planned tariff hikes on Chinese imports . That buoyed risk appetite, sending bond yields higher alongside stocks and crude oil prices. China responded approvingly, fixing the Yuan higher and confirming it will show up for next month's trade talks.


German GDP figures are in the spotlight from here. Output in the Eurozone's largest economy is expected to have shrunk 0.1 percent in the second quarter. Regional data has increasingly undershot forecasts lately, opening the door for a still-weaker outcome.

This may revive global slowdown fears and sour risk appetite anew, putting gold back on offense. Upside progression may be limited if haven demand buoys theUS Dollarhowever. Crude oil prices might face selling pressure in the meanwhile.

The bears' resolve may be bolstered if official EIA inventory data echoes yesterday's API projection signaling stockpiles added 3.7 million barrels last week. That would mark substantive disappointment relative to baseline projections envisioning a 2.19-million-barrel outflow.

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Negative RSI divergence below resistance marked by the 61.8% Fibonacci expansion at 1513.94 hints gold prices may be topping. A break back below the 50% level at 1492.31 initially targets the 38.2% Fib at 1470.68. Alternatively, a daily close above 1513.94 exposes the 76.4% expansion at 1540.70 next.

Gold price chart - daily

Gold pricechart created usingTradingView


Crude oil prices moved back above the 54.72-56.09 congestion zone, menacing trend line resistance capping the upside since late May (now at 58.71). A daily close above that aims for the 60.04-84 area next. Alternatively, a reversal back below 54.72 opens the door for a retest of the 49.41-50.60 region.

Crude oil price chart - daily

Crude oil price chart created usingTradingView

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--- Written by Ilya Spivak, Currency Strategist for

To contact Ilya, use the comments section below or@IlyaSpivakon Twitter



Gold Prices Eye German GDP Data, Chart Setup Warns of Topping


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