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Fundamentals

During the Asian session on Tuesday (October 17), spot gold traded in a narrow range, currently trading around 1,915. Yesterday and today, it was pulled back to 1,908 as expected, and the aggressive could be able to reap a profit of US$10. Overnight, the FOMC voting member, Philadelphia Fed President Harker said that if there is no sudden change in economic data, the Federal Reserve should keep interest rates unchanged. This proper dovish remark also caused the USD to decline slightly. On the contrary, the yield of U.S. Treasury Securities collectively closed up. European Central Bank (ECB) President Lagarde also said yesterday that she is paying attention to oil prices to judge the impact of the Palestinian-Israeli conflict on inflation. For the current gold price, we still maintain an optimistic attitude. On the one hand, Fed officials continue to make dovish remarks to support the gold price, and it may be difficult to make a big turn in the short term; On the other hand, the situation in the Middle East is escalating, and the demand for safe haven will also boost the price of gold. In the short term, the probability of the end of the war is very small, and the next thing we need to pay attention to is whether the situation of the Palestinian-Israeli war will expand. If it expands, the price of gold can recover the decline in September at any time and then go above 2,000.

Data: The U.S. New York Fed's manufacturing index in October was -4.6, with an expected value of -7 and a previous value of 1.9. The euro zone's trade account surplus in August was EUR11.9 billion after seasonal adjustment, and the previous surplus was EUR2.9 billion; the non-seasonally adjusted trade account surplus was EUR6.7 billion, and the previous surplus was EUR6.5 billion.

Today's Focus: the monthly/annual retail sales rate, annual rate of industrial output, and monthly rate of commercial inventory in the U.S. in September. Important event: speech delivered by Williams, permanent voting member of FOMC and chairman of New York Federal Reserve, at the Economic Club of New York tonight.

Technical Analysis

Yesterday, the gold price fluctuated. It recorded the lowest price in the Asian session at 1,908 and the highest price at 1,925. The trend was basically as we expected. After the pullback, the opportunity to set positions was available, and it stopped loss at 1,912. Yesterday, we emphasized that the aggressive could stop loss in 1,910-1,915 and try to go long, and it also successfully realized a profit of US$10, reaching the first profit-taking goal. Again, we don't predict the trend, we just need to make a good trading plan. The only thing we can be sure of in trading is our losses. As for the profit, it depends on how much the market offers. As for the market trend, the current gold price is still in an upward trend, and it will be slightly pulled back after the big rise. This is an obvious bullish trend. In the bullish trend, prices are still easy to rise and difficult to fall. We should never guess where the top is but just follow the trend. Even if there is a turn, the trend will not be temporary, especially the trading cycle of a trading logic will not be short-lived. The current trading logic is still the Middle East conflict. Before we see the end of this, we still have to keep going long with the bullish outlook. Don't be greedy for a small pullback in the middle of the way and go short. Unless there is a major resistance and the trend is weak, we can still take advantage of the differences. In the face of fundamentals, any technical analysis will be slightly eclipsed in the short term, but we can use technical means to help us better build our positions. Today's trading strategy is still to go long at the pullbacks, and we should pay attention to the opportunities for going long at the support of the 1,900-1,905 range.

Trading Strategy: It is advised to buy low. If the price falls back to 1,903 during the day, you can still try to go long with small positions in the short term and bet on a rebound. The stop-loss can be uniformly set at 1,900, and the first target at 1,925 where you can reduce the position size and move the stop-loss to breakeven. The second target can be set at 1,935.

Trading Recommendations

Trading direction: Long

Entry price: 1900

Target price: 1935

Stop loss: 1896

Support: 1908.000, 1900.000

Resistance: 1925.000, 1933.000