Gold is exiting the overbought zone on both weekly and daily timeframes, with fundamentals aligning with technical signals for a return to more balanced levels.
The investment community welcomed news that top American and Chinese officials will meet to ease mutual trade duties. The meeting, focused on economic issues, will be held this week. This is the first sign of a thaw in trade relations between the world's two leading economies. Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer will visit Geneva to meet with Swiss President Karin Keller-Sutter and, separately, with Chinese officials. On Tuesday, Bessent said he did not expect a major trade deal as a result of the discussion, but stressed that it is an important step in the negotiations.
Greer said the negotiations aim to balance trade relations between the countries and achieve reciprocity and openness to new markets, as well as protect US economic security.
In addition, China cut interest rates and promised to support stock markets. On Wednesday, the country's central bank governor announced a 10-basis-point cut in the benchmark interest rate and a 50-basis-point cut in bank reserve requirements to boost liquidity.
All these news are currently contributing to the weakening of gold as a safe-haven asset.
The overall recommendation is to sell gold.
Profits should be taken at the level of 3,200. A Stop loss could be set at the level of 3,500.
The volume of the opened position should be set in such a way that the value of a possible loss, fixed with the help of a protective Stop loss order, is no more than 1% of your deposit funds.
This content is for informational purposes only and is not intended to be investing advice.
