Dollar gold ice fire two-day gold bulls approaching life and death

Spot gold continued to fall sharply on Tuesday (May 1st), the lowest in the US market to 1301.51 US dollars / ounce, this week, the price of gold has broken through the 1320 and 1310 mark, further testing the 1300 psychological mark. The US dollar continued to soar on Tuesday, the US dollar index has broken the 92 mark, and the highest hit 92.57. The sharp rise of the US dollar is a big negative for gold. The data released during the day is mixed. The data shows that the final value of the Markit manufacturing PMI in the United States in April was 56.5, which was in line with the previous value and expectations. It remained at the high level since September 2014, indicating that the US economy started in the second quarter and is also stable. The GDP growth rate has released a positive signal. The US ISM manufacturing PMI of 57.3 in April was lower than the previous value of 59.3 and the expected 58.3, which was the lowest since July 2017. The association said that the tariff terms of the US 232 and 301 investigations are very worrying. US monthly construction spending in March was -1.7%, lower than the previous value of 0.1% and expected 0.5%.

This week, the market will focus on two important events. The Fed’s open market meeting will be held on Tuesday morning and a statement will be released on Wednesday afternoon. At the same time, the US high-level trade delegation visited China to negotiate on Sino-US trade. US President Trump decided on Monday to impose tariff extensions on EU steel and aluminum products, but will still take effect for China and Russia. The analysis said that the current strength of the US dollar and the high expectations of the Fed's interest rate hike in June have imposed greater constraints on gold. As the US dollar index returns to the 200-day moving average (91.85) for the first time this year, and there is no significant catalyst in the market, This means that the strength of the dollar will not stop in the short term. However, some analysts pointed out that with the flattening of US bond yields and the expansion of the US fiscal deficit, gold still has a chance to rebound in the second half of the year. It is not impossible for gold prices to return to the 1350 line. At present, technically, after the price of gold falls below the 1310 mark and the 200-day moving average, the gold price will next test the important psychological level of the immediate support level of 1300. If it falls below this level, it will look further at the 50-week moving average of $1,295. On the upside, if it returns above $1310, the next resistance will look towards the 200-day moving average at $1,320, with further resistance at $1330 and $1,340. The breakout is seen at the high of $1,366 during the year. On the daily technical indicators, the MACD green kinetic energy column continues to expand, the double-line dead fork, the stochastic indicator is downward; in the Bollinger channel, the gold price approaches the lower rail and the short-term moving average is downward.

Tuesday's trend statement

International spot gold Tuesday (May 1st) Asian market opened at 1315.40 US dollars / ounce in early trading, the price of gold rose briefly, recorded an intraday high of 1316.32 US dollars / ounce and then fell, the price of gold shocked down. The European gold price continued its decline, and it rebounded in the session but it was a short-lived one. The US gold price increased the decline. After hitting an intraday low of 1301.51 US dollars per ounce, it bottomed out and the gold price fluctuated upwards. However, the gains failed to fall again and again, and finally closed at $130.60 per ounce.

International spot gold on Tuesday (May 1st) Asian market opened at 1315.40 US dollars / ounce in early trading, the lowest test 1301.51 US dollars / ounce, the highest rose to 1316.32 US dollars / ounce, and finally closed at 1303.60 US dollars / ounce, down 11.35 US dollars, a decrease of 0.86 %.

Fundamental positive factors:

1. The US April ISM manufacturing PMI 57.3 announced on Tuesday (May 1) was lower than the previous value of 59.3 and the expected 58.3, which was the lowest since July 2017. The association said the tariff terms for the US 232 and 301 investigations. Very worrying. US monthly construction spending in March was -1.7%, lower than the previous value of 0.1% and expected 0.5%.

2. The US Richmond Fed manufacturing index for April released on Tuesday (April 24) was -3, well below the previous value of 15 and expectations of 16.

3. The US Dallas Fed's commercial activity index for April released on Tuesday (April 24) was 21.8, higher than the previous value of 21.4 but lower than expected.

2. The March leading index of the US March Conference Board announced on Thursday (April 19) was 0.3%, lower than the previous value and expected to have a smaller impact.

Fundamental negative factors:

1. The final US Markit manufacturing PMI released on Tuesday (May 1st) was 56.5, which was in line with expectations and maintained at a high level since September 2014, indicating that the US economy started to be stable in the second quarter. A positive signal was released for GDP growth.

2. Data released on Monday (April 30) showed that the US core PCE price index was 1.9% in March, which was higher than the previous value. The US monthly personal expenditure rate was 0.4% in March, which was higher than the previous value. .

3. Data released on Monday (April 30) showed that the US PMI in April was 57.6, higher than the previous value of 57.4 but lower than the expected 57.9, down 1.1% year-on-year, the largest year-on-year decline in 15 months.

4. Data released on Monday (April 30) showed that the US monthly home sales index was 0.4%, lower than the previous value of 3.1% and expected 0.9%; again restricted sales activities due to insufficient sales properties

Outlook outlook

1.FX168 Financial News (Hong Kong) News Kitco's weekly gold survey released on Friday (April 27) showed that despite the poor gold gains last week, the market has slightly different views on this week's trend, but more than half of it. Respondents are still bullish on gold this week, with average investors being more optimistic about short-term prospects. In the survey of Wall Street professionals, 23 people participated in the survey, 12 people, or 52% think that gold will rise this week, 5 people or 22% think that gold will fall this week, 6 people or 26% Gold believes it will consolidate. Market participants include gold traders, investment banks, futures traders and technical analysts. In the survey of ordinary investors, 903 people participated in the survey, 522 people, or 58% think that gold will rise this week, 295 people or 33% think that gold will fall this week, 86 people or 10% I think gold will be consolidating.

2. Information website Economies.com said in a report released on Tuesday (May 1st) that gold continued to trade around negative trading below $13.148/oz, keeping the intraday bearish trend effective, and the price of gold opened towards the next target at $1301.20 per ounce. The path, the 50-day moving average provides support for continued decline, and the price of gold below steady at $13,148.48 per ounce is an important condition for continued decline.

3. MKS (Switzerland) said in a report released on Tuesday (May 1) that as gold prices continue to fall, the 200-day moving average and the psychologically important $1,300 mark will become the main support areas for precious metals. On the other hand, MKS said that gold should encounter resistance at the 100-day moving average. The price is now around $1,322.

4. Brown Brothers Harriman pointed out in a report released on Tuesday (May 1) that the US dollar index, which measures the dollar against a basket of currencies, exceeded its 200-day moving average for the first time in more than a year. BBH said that most of the world's financial centers were closed during the May Day holiday, but the lack of participation did not prevent the continuation of the dollar's recovery. The US dollar index was above the 200-day moving average for the first time in a year. There is no new catalyst. For example, the US dollar is good for Germany. The spread of the difference is unprecedented. Just as Fed officials can be more convinced that their mission has been met (more than previously and other major central banks), so is the investor. The 200-day average for the US dollar index is 91.85.

5. In a report released on Tuesday (May 1st), TD Securities said that as the US dollar strengthens, gold prices will fall to the $1300/oz mark, but it also indicates that gold prices may rebound to later in 2018. $1,350 per ounce. Dao Ming said, "If we continue to see the US economy performing well, the Fed will send a hawkish tone. Many observers have said that there will be four interest rate hikes this year, but this may be bad news for the current gold. However, considering 10 The fact that the curve of the national bond yield has slowed to around 3% has slowed down, the dollar momentum has weakened and the US deficit has reached an alarmingly high level. Gold should remain stable, although it may fall to $1,300 per ounce in the near future. Low, but we believe that the second half of 2018 will steadily rise to $1,350."

6. German commercial bank said in a report released on Monday (April 30) that gold has fallen below $1,320 per ounce at the beginning of the new trading week. “One factor that measures prices is still that the dollar is strong.” “There is a sign that the North Korean conflict is easing, indicating that gold currently lacks solid demand as a safe-haven asset. After North Korean leader Kim Jong-un held a historic meeting with South Korean President Yue Mingen North Korea appears to be preparing to close its nuclear test facility in the northeastern part of the country."

7. FXTM Chief Market Strategist Hussein Sayed said in a report released on Monday (April 30) that foreign exchange traders will monitor US inflation data, the FOMC meeting of the Federal Open Market Committee and this week's non-agricultural monthly employment report. To determine whether to continue pushing up the dollar exchange rate. Analysts pointed out that attention will be turned to the Federal Open Market Committee's statement on Wednesday later this week. Although the market does not expect any change in policy, the conference will not hold a press conference or economic forecast update, but any signs of steep inflation expectations should support the prospect of three interest rate hikes in 2018, not twice.

Focus on Wednesday

20:15 US ADP employment in April

22:30 EIA crude oil inventories from the US to the week of April 27

02:00 The next day, the Federal Reserve FOMC announced the interest rate resolution and policy statement

Proofreading: Sui Bin

(Editor: Liu Xiaoman HF108)