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Gold Elliott wave analysis- bullish trend resumes ahead of US-China talks

Gold Elliott wave analysis- bullish trend resumes ahead of US-China talks

Gold has returned upside to resume the bullish trend ahead of the US-Sino trade talk later in the week. The following Gold Elliott wave analysis looks at what could happen next.

October 08, 2019 | AtoZ Markets – The yellow metal has returned upside early on Tuesday after Monday’s slump below the 1500 psychological level. The metal has quickly recovered above 1500 and if it proceeds in this direction, it might hit above 1520 before the US-China talks on Thursday. Prior to the meeting, the metal is expected to react faster to any negative news than positive. Generally, a ‘no-deal’ will see Gold run above 1557 to the 1600 handle.

US-China trade deal: what are the possibilities?

China delegation will arrive in Washington later this week for the 13th round of talks. The US is scheduled to raise tariffs on Chinese products next week but the outcome on Thursday will determine if it will go with the plan. However, on Monday, President Trump sounded a bit optimistic about the talk but adding that he would not be satisfied with a partial deal. He added that the political protests in Hong Kong could make things complicated if China does not find a humane resolution.

Meanwhile, according to reports, China is turning down its expectations as there are still fundamental issues that the two teams are divergent on. US will not take a partial deal, it remains to be seen whether China will compromise to find a resolution once and for all. However, with the way the Gold price is reacting, it seems investors are still doubtful of a successful talk. Gold will be one of the beneficiaries of a trade talk breakdown.

Gold analysis: important price levels

Resistance Levels: 1520, 1535, 1557 and 1600. A breach above 1520 is expected to be followed by a break above 1557 high.

Support Levels: 1459, 1451 and 1400 are the important levels to watch out for.

Gold Elliott wave analysis

The Gold Elliott wave analysis is very clear. The dip from 1557 ended at 1463 and the price broke upside to 1520. In the last update, we looked at the minor dip from 1520 with the chart below.

The price is playing out just as expected. The minor dip continued to 1488 and then pushed upside as the new chart below shows.

If the Gold price could break above the wave (ii) channel toward 1520, the bullish trend might resume toward 1600. The US-China trade talks on Thursday is, of course, a big deal.

 

 

 

Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.

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