Price of Gold Fundamental Daily Forecast – Price Action Suggests Investors Seeking Clarity

Gold is trading flat-to-higher for a fourth session on Thursday, indicating investor indecision and impending volatility. Traders are also showing a muted response to a steep drop in the U.S. Dollar Index and a plunge in U.S. Treasury yields. There is also a limited response to lower demand for risk.

At 10:17 GMT, April Comex gold is trading $1328.40, down $0.01 or -0.01%.

The price action indicates that gold may have found good support at $1300.00. However, the news hasn’t been strong enough to fuel a resumption of the rally. Gold traders also have a lot on their plate to digest at this time including Fed Chairman Jerome Powell’s Congressional testimony, U.S.-China trade negotiations, the U.S.-North Korean summit and Brexit.

During his testimony before the U.S.-Senate Banking Committee on Tuesday, Powell reiterated that the Fed will remain “patient” in deciding on further interest rate hikes.

There were no new developments over the U.S.-China trade talks, however, traders remain optimistic that a new deal will be reached in a timely manner.

President Trump and North Korean leader Kim Jong Un will try to reach an agreement over North Korea’s nuclear weapons in their second summit on Wednesday.

The stalemate over Brexit means the countdown has begun leading up to Britain’s exit from the European Union on March 29. This means the political chaos is deepening.

Daily Forecast

The conditions are ripe for an extension of the rally, however, the catalyst for such a move is unclear. Fed Chair Powell continues his testimony later today, so he may be the next source of volatility. The U.S.-North Korean talks are a minor event and U.S.-China trade talks would have to completely breakdown to fuel a major reaction in gold.

Today’s reports include Goods Trade Balance, Preliminary Wholesale Inventories, Factory Orders and Pending Home Sales. They aren’t expected to have a major impact on gold prices.

Gold traders should continue to monitor Treasury yields, stock market volatility and the U.S. Dollar Index. These factors are likely have the most influence on prices.