Gold has been trading in a falling triangle since late February. It can be seen as a correction of the bullish trend, which has lasted since mid-November 2018. At the end of last week the asset corrected upwards from the lower limit of the triangle, and is now trying to gain a foothold in the zone of $1280-1285/oz. If the local trend continues, the resistance level will be in the of $1290-1295 area, where the upper limit of the triangle is located. In case of its breakout, a new bullish trend may begin.
The US dollar is the main driver of gold movement. Having updated the 2-year high, the USD began to decline. The DXY index fell by 0.8% before the upcoming FOMC meeting. The Fed will end its meeting on Wednesday, and the market players don’t expect it to change the interest rate. At the last meeting, it was announced that most likely, the rates will not rise this year due to the threat of economic growth slowdown. At the same time, according to Goldman Sachs, the central bank continues to buy gold, which keeps quotes from further decline.
Of course, the resolution of trade war between the USA and China can certainly reduce the traders' interest in safe haven assets. This week the US delegation is to go to Beijing for further negotiations. The US Secretary of Treasury believes that negotiations are close to an end, and perhaps Donald Trump will soon meet the Chinese leader to sign the final agreement.