Gold Prices Surge Over ECB Stimulus – Reason Explained

New York (Sept 13)  On Friday, the yellow metal gold continues to trade bullish even as improved risk appetite amid indications of ease in the long-drawn U.S.-China trade tariffs drew investors away from safe-haven assets. The US President Donald Trump announced that he expects a broad trade agreement with China and also mentioned the possibility of an interim pact.

As a result, the Asian equities advanced as evidence of growth in trade talks between the world’s two top nations improved the risk sentiment. In addition to this, the European Central Bank’s chief, Mario Draghi, pledged indefinite stimulus on Thursday to revive an ailing Eurozone economy.

GOLD – XAU/USD – Technical Outlook

On the technical side, gold is facing substantial resistance at 50% Fibonacci retracement area of $1,505, and the violation of this can extend bullish rally until $1,512, which marks 61.8% Fibonacci retracement levels. On the lower side, support stays around $1,500 and $1,494.

Gold took a sharp bullish and bearish turn below 50% Fibonacci retracement area of around 1524. For now, the precious metal is holding below 1500 psychological level, and closing of candles below this is signaling odds of a bearish bias.

Gold may continue to drop below 1500 level until 1494 and 1487 areas today.

FXleaders

Silver Phoenix Twitter                 Silver Phoenix on Facebook