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Gold prices are constrained in a narrow horizontal channel

Gold prices remain constrained in a very narrow range. News of US-China trade relations have gradually fallen into the background. The parties have not yet disclosed any details of the agreement. In addition, the White House economic adviser Larry Kudlow had recently stated that the United States over the next 6-9 months will closely monitor the implementation of the PRC's obligations under the agreement.

The market is currently focused on the news of Donald Trump's  impeachment. House of Representatives, which mostly consists of democrats, supported the allegations against D. Trump regarding the abuse of power and obstruction of Congress. The issue is referred to the Senate, where most of the seats belong to the Republicans. Senate Majority Leader Mitch McConnell has said the Republican party does not intend to impeach Trump. To finalize such decision, two-thirds of the votes are necessary.

Gold, as a defensive asset, may locally receive some dividends from rising political uncertainty in the United States. But, the likelihood of a positive decision to impeach Trump remains very low.

In addition to political news, investors should follow the publication of the secondary housing sales market and manufacturing activity index data published by the Federal Reserve Bank of Philadelphia.

Regarding the chart, no significant changes have occurred. The wide horizontal channel of 1460.00-1483.00 still maintains the medium-term relevance. Locally, trading takes place in a narrow range in the region of  1475.00. Currently, we consider the most probable scenario to be growth from 1475.00 towards 1483.00.

Resistance Levels: 1483.00, 1490.00, 1505.00;

Support Levels: 1475.00, 1460.00, 1455.00.

The main scenario - an increase towards 1483.00 and further downward movement.

An alternative scenario - a breakdown of support at the level of 1475.00 and a decline towards 1460.00.

The fundamental outlook is neutral. Within a daily framework, we consider purchases from the level of 1475.00.

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