The UK elections handed PM Johnson a landslide victory as his Tories took seats from Labour, the biggest loser of the night. The British Pound surged, and the focus will now shift back to Brexit. The UK is anticipated to leave the EU on January 31st 2020. Gold maintained its bullish bias despite the announcement of a phase-one trade deal in principle. How will this precious metal react after Trump comments on the deal? Subscribe to the PaxForex Daily Fundamental Analysis and grow your balance trade-by-trade.
In the meantime, economic data remains soft. The New Zealand Business Manufacturing PMI eased, and the critical Japanese Tankan survey for the fourth quarter came in mixed. Italian new industrial orders plunged on an annualized basis, and China saw a contraction in foreign-direct investment. Will bulls push Gold higher as the announced trade deal remains insignificant, or will bears attempt to force more downside? Today’s fundamental analysis will take a look at price action in both directions.
Here are the key factors to keep in mind today for Gold trades:
- New Zealand Business Manufacturing PMI: The New Zealand Business Manufacturing PMI for November was reported at 51.4. Forex traders can compare this to the New Zealand Business Manufacturing PMI for October, which was reported at 52.6.
- Japanese Tankan Survey: The Tankan Large Manufacturers Index for the fourth-quarter was reported at 0. Economists predicted a figure of 3. Forex traders can compare this to the Tankan Large Manufacturers Index for the third quarter, which was reported at 5. The Tankan Large Manufacturers Outlook for the fourth-quarter was reported at 0. Economists predicted a figure of 3. Forex traders can compare this to the Tankan Large Manufacturers Outlook for the third quarter, which was reported at 2. The Tankan Large Non-Manufacturers Index for the fourth-quarter was reported at 20. Economists predicted a figure of 16. Forex traders can compare this to the Tankan Large Non-Manufacturers Index for the third quarter, which was reported at 21. The Tankan Large Non-Manufacturers Outlook for the fourth-quarter was reported at 18. Economists predicted a figure of 16. Forex traders can compare this to the Tankan Large Non-Manufacturers Outlook for the third quarter, which was reported at 15. The Tankan Small Manufacturers Index for the fourth-quarter was reported at -9. Economists predicted a figure of -7. Forex traders can compare this to the Tankan Small Manufacturers Index for the third quarter, which was reported at -4. The Tankan Small Manufacturers Outlook for the fourth-quarter was reported at -12. Economists predicted a figure of -8. Forex traders can compare this to the Tankan Small Manufacturers Outlook for the third quarter, which was reported at -9. The Tankan Small Non-Manufacturers Index for the fourth-quarter was reported at 7. Economists predicted a figure of 4. Forex traders can compare this to the Tankan Small Non-Manufacturers Index for the third quarter, which was reported at 10. The Tankan Small Non-Manufacturers Outlook for the fourth-quarter was reported at 1. Economists predicted a figure of 3. Forex traders can compare this to the Tankan Small Non-Manufacturers Outlook for the third quarter, which was reported at 1. The Japanese Tankan Large All Industry Capex Index for the fourth-quarter increased by 6.8% quarterly. Economists predicted an increase of 6.0% quarterly. Forex traders can compare this to the Japanese Tankan Large All Industry Capex Index for the third quarter, which increased by 6.6% quarterly.
- Chinese Foreign Direct Investment: Chinese Foreign Direct Investment for November increased by 6.0% annualized. Forex traders can compare this to Chinese Foreign Direct Investment for October, which increased by 7.4% annualized.
- Japanese Industrial Production and Capacity Utilization: Final Japanese Industrial Production for October decreased by 4.5% monthly and by 7.7% annualized. Forex traders can compare this to previous Japanese Industrial Production for October, which decreased by 4.2% monthly and by 7.4% annualized. Capacity Utilization for October decreased by 4.5% monthly. Forex traders can compare this to Capacity Utilization for September, which increased by 1.0% monthly.
- German Wholesale Price Index: The German Wholesale Price Index for November decreased by 0.1% monthly and by 2.5% annualized. Forex traders can compare this to the German Wholesale Price Index for October, which decreased by 0.1% monthly and by 2.3% annualized.
- Spanish CPI: The Preliminary Spanish CPI for November increased by 0.2% monthly and by 0.4% annualized. Economists predicted an increase of 0.2% and 0.4%. Forex traders can compare this to the Spanish CPI for October, which increased by 1.0% monthly and by 0.1% annualized. The Preliminary Spanish Harmonized Spanish CPI for November was reported flat at 0.0% monthly and increased by 0.5% annualized. Economists predicted a flat reading of 0.0% and an increase of 0.5%. Forex traders can compare this to the Spanish Harmonized Spanish CPI for October, which increased by 0.7% monthly and by 0.5% annualized.
- Italian Industrial New Orders and Industrial New Sales: Italian Industrial New Orders for October increased by 0.6% monthly, and decreased by 1.5% annualized. Forex traders can compare this to Italian Industrial New Orders for September, which increased by 0.9% monthly and by 0.2% annualized. Italian Industrial New Sales for October increased by 0.6% monthly and decreased by 0.2% annualized. Forex traders can compare this to Italian Industrial New Orders for September, which increased by 0.2% monthly, and which decreased by 1.6% annualized.
- US Advanced Retail Sales: US Advanced Retail Sales for November are predicted to increase by 0.4% monthly and Retail Sales Less Autos are predicted to increase by 0.3% monthly. Forex traders can compare this to US Advanced Retail Sales for October, which increased by 0.3% monthly and to Retail Sales Less Autos, which increased by 0.2% monthly. Retail Sales Less Autos and Gas for November are predicted to increase by 0.4% monthly and Retail Sales Control Group are predicted to increase by 0.3% monthly. Forex traders can compare this to Retail Sales Less Autos and Gas for October, which increased by 0.1% monthly and to Retail Sales Control Group, which increased by 0.3% monthly.
- US Import and Export Price Index: The US Import Price Index for November is predicted to increase by 0.2% monthly, and to decrease by 1.2% annualized. Forex traders can compare this to the US Import Price Index for October, which decreased by 0.5% monthly and by 3.0% annualized. The US Import Price Index excluding Petroleum for November is predicted flat at 0.0% monthly. Forex traders can compare this to the US Import Price Index excluding Petroleum for October, which decreased by 0.1% monthly. The US Export Price Index for November is predicted to increase by 0.1% monthly and to decrease by 2.2% annualized. Forex traders can compare this to the US Export Price Index for October, which decreased by 0.1% monthly and by 2.2% annualized.
- US Business Inventories: US Business Inventories for October are predicted to increase by 0.2% monthly. Forex traders can compare this to US Business Inventories for September, which were reported flat at 0.0% monthly.
Should price action for Gold remain inside the or breakout above the 1,461.70 to 1,478.50 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1,472.00
- Take Profit Zone: 1,517.60 – 1,527.55
- Stop Loss Level: 1,458.60
Should price action for Gold breakdown below 1,461.70 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1,449.00
- Take Profit Zone: 1,400.30 – 1,414.75
- Stop Loss Level: 1,472.00
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