Gold has been trading in an upward correction channel with a width of $25 for more than a month. A number of factors are limiting the movement up. A strong resistance level of $1480 an ounce acts as a local barrier. The asset broke it last Thursday, but then the price immediately fell by $20 following Donald Trump’s tweet about his readiness to sign an interim trade agreement. It was indeed prepared on Friday, but the market has not reacted to this news.
At the moment, bulls are trying to overcome $1480. But even if they succeed, the further growth is problematic. There is the upper limit of the current price channel around $ 1490 per ounce, as well as the line of the global downtrend, in which gold has been trading since late August.
Advances in the trade conflict between the US and China, as well as in Brexit, put pressure on the quotes. There is only one reason for the local growth of gold: the US dollar is declining. Since the beginning of December, the DXY index has lost 1.3%, broken the uptrend line, in which the dollar has been trading since May 2018, and continues to fall. If this is the beginning of a long bearish trend for the US dollar, gold and other metals will be supported by this factor.