Gold has updated its annual maximum at around $1348 per ounce at the end of last week. However, it failed to stay in this zone for a long time, and a downtrend began at the beginning of the current week. The asset found local support at $1322. Here, we expect a flat followed by further movement. If the $1322 level is broken, the price may move down to$ 1310-1315. However, the current level has all the chances to hold on, which will mean that a return to $1327-1329 in the short term.
Gold fell sharply by nearly 2% after the US and Mexico reached an agreement on migration at the end of last week in order to prevent a trade war. US President Donald Trump had previously threatened to impose 5% tariffs on all Mexican goods if Mexican authorities could not restrain the flow of illegal migrants.
Weak data on US employment provided support for gold, as soon as it increased the the chances of lower interest rate in the US this year. The latest data on NFP might affect the policy of the regulator towards mitigation. Last week, Fed Chairman Jerome Powell assured the markets that the FED would `act as appropriate' to ensure expansion of US economy. The US Central Bank is due to make its next statement on monetary policy on June 19.