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Fundamentals

During the Asian session on Wednesday (October 18), spot gold fluctuated within a narrow range and is currently trading around 1,930. Yesterday, the price was slightly pulled back to 1,912, at which it gained support before continuing its uptrend. It rose to 1,932 in intraday trading and finally closed with a short white body. At present, the dominant factor of gold price is very clear, that is, the Palestinian-Israeli conflict. What market investors need to do at present is to pay close attention to the development of the Palestinian-Israeli conflict, and the demand for hedging will continue to support the gold price. If the war continues to expand to the ground or Iran joins the war, the gold price will undoubtedly rise above 2,000 again. However, under the tension between Russia and Ukraine and the Taiwan Strait issue, the U.S. does not want the situation in the Middle East to expand. If Biden visits Israel today, if he can persuade him not to expand, perhaps the price of gold will ease and the callback is imperative, but there is little possibility of a truce at present. During Biden's visit to Israel, if he can persuade Israel not to expand the war, perhaps the rise of gold prices will ease and a pullback is imperative, but there is little possibility of a truce at present. For the gold price, it will undoubtedly continue to play a supporting role in the short and medium term. We emphasize once again that we should go long for the gold price with a bullish outlook. Any intraday pullback will be an opportunity for us, and the center of fluctuation will gradually rise.

Data: The monthly retail sales rate of the U.S. "terror data" in September was 0.7%, which greatly exceeded the expected 0.3%, and the previous value was revised from 0.6% to 0.8%. The industrial output in September rose by 0.3% month-on-month, which is expected to be flat, with a previous value of 0.4%. The manufacturing output was 0.4% month-on-month, with an expected value of 0.1% and a previous value of 0.1%. The ZEW Indicator of Economic Sentiment of the eurozone in October was 2.3, with a previous value of -8.9.

News: After Blinken's two unsuccessful visits to Israel, U.S. President Biden will visit Israel on Wednesday. On Tuesday, a hospital in Gaza was razed to the ground by a bomb, which has killed at least hundreds of people. The United Nations says Israel also bombed a school in Gaza City, and at least 4,000 people took refuge in the school.

Today's Focus: U.S. Housing Starts in September, EIA crude oil inventories, and CPI in the eurozone.

Technical Analysis

Yesterday, the gold price fluctuated. It recorded the lowest price during the Asian session at 1,912 and the highest price at 1,933, closing with a long white body for both the upper and lower shadow. The momentum in the market appeared to be not too strong but basically resilient. Technically, the SMAs were all diverging upward, and the golden cross of the MACD began to gradually broaden, which got back to the 0-axis. The market still shows a bullish pattern. The price has risen by 130 points from 1,810, while all bears have turned to bulls. Perhaps we need short-term trading opportunities for regional fluctuation. For the above strategy, investors can pay attention to the resistance around 1,950, and aggressive can wait for an opportunity to go short with small positions, but they should also take the stop-loss and take-profit into consideration.

Trading Strategy: It is advised to buy low and sell high. If the price falls back to 1,930 during the day, you can still try to go long with small positions in the short term. The stop-loss can be uniformly set at 1,925, and the first target at 1,947 where you can reduce your position size and move the stop-loss to breakeven. The second target can be set at 1,953. If the price rises to 1,953, you can still try to go short with small positions in the short term. The stop-loss can be uniformly set at 1,958 and the first target at 1,935 where you can reduce your position size and move the stop-loss to breakeven. The second target can be set at 1,917.

Trading Recommendations

Trading direction: Short

Entry price: 1953

Target price: 1917

Stop loss: 1958

Support: 1933.000, 1917.000

Resistance: 1947.000, 1953.000