Chinese industrial profits contracted for a second consecutive month, but traders grew more confident that a permanent resolution to the US-China trade war can be found. Solid third-quarter earnings season has further boosted optimism that companies have performed well despite the uncertainties. Gold managed to advance as risks remain, a range of economic data out of the US has indicated the slowdown is accelerating. How will this precious metal perform to start the fresh week? Today’s fundamental analysis will take a look at price action in both directions.
Traders will also focus on today’s vote in the UK Parliament in regards to PM Johnson’s call for a snap election on December 12th 2019. With the Labour Party expected to oppose such a move and the DUP also against it, PM Johnson will have an uphill battle to secure two-thirds of the vote. Brexit uncertainty remains which is anticipated to keep upside pressure on gold, will bulls capitalize on it? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Here are the key factors to keep in mind today for Gold trades:
- Chinese Industrial Profits: Chinese Industrial Profits for September decreased by 3.3% annualized. Forex traders can compare this to Chinese Industrial Profits for August which decreased by 2.0% annualized.
- Japanese Corporate Service Price Index: The Japanese Corporate Service Price Index for September increased by 0.5% annualized. Economists predicted an increase of 0.5% annualized. Forex traders can compare this to the Japanese Corporate Service Price Index for August which increased by 0.6% annualized.
- German Import Price Index: The German Import Price Index for September is predicted to increase by 0.1% monthly and by 3.0% annualized. Forex traders can compare this to the German Import Price Index for August which decreased by 0.6% monthly and by 2.7% annualized.
- Eurozone M3 Money Supply: Eurozone M3 Money Supply for September is predicted to increase by 5.7% annualized. Forex traders can compare this to Eurozone M3 Money Supply for August which increased by 5.7% annualized. Eurozone Private Sector Loans for September are predicted to increase by 3.5% annualized. Forex traders can compare this to Eurozone Private Sector Loans for August which increased by 4.3% annualized.
- UK CBI Reported Sales and CBI Total Distributed Reported Sales: UK CBI Reported Sales for October are predicted at -20 and CBI Total Distributed Reported Sales are predicted at 5. Forex traders can compare this to UK CBI Reported Sales for September which were reported at -16 and to CBI Total Distributed Reported Sales which were reported at 3.
- US Advanced Goods Trade Balance: The US Advanced Goods Trade Balance for September is predicted at -$73.5B. Forex traders can compare this to the US Advanced Goods Trade Balance for August which was reported at -$72.8B.
- US Wholesale Inventories: US Preliminary Wholesale Inventories for September are predicted to increase by 0.3% monthly. Forex traders can compare this to US Wholesale Inventories for August which increased by 0.2% monthly.
- US Chicago Fed National Activity Index: The US Chicago Fed National Activity Index for September is predicted at 0.05. Forex traders can compare this to the US Chicago Fed National Activity Index for August which was reported at 0.10.
- US Dallas Fed Manufacturing Activity Index: The US Dallas Fed Manufacturing Activity Index for October is predicted at 1.0. Forex traders can compare this to the US Dallas Fed Manufacturing Activity Index for September which was reported at 1.5.
Should price action for Gold remain inside the or breakout above the 1,495.70 to 1,512.45 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1,505.50
- Take Profit Zone: 1,556.70 – 1,579.10
- Stop Loss Level: 1,493.00
Should price action for Gold breakdown below 1,495.70 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1,493.00
- Take Profit Zone: 1,458.90 – 1,469.50
- Stop Loss Level: 1,505.50
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