A trade deal with China isn’t close, according to a senior Trump administration official cited by Axios. The unnamed source said that the differences between the two sides are so great that, in his view, there won’t be a resolution before the end of the year. While there have been conciliatory-sounding remarks from both sides over the last day, doubtlessly intended to calm stock markets, Beijing today communicated via editorials in state-backed media a much tougher stance, blaming the trade war on “one person and his administration and asserting that the US is misjudging China’s “capability and willpower.” As Axios highlighted, this is turning into a contest between President Trump, who faces an election next year, and president-for-life Xi. Trump’s view is that a trade war will hurt China more than the US.
The continuing in intransigence on both sides looks to have triggered a nascent recovery of the Gold market, during a traditionally quiet month. The rally to $1300 on Monday (May 13) following the risk-on spike, has so far failed to re-trace beyond $1292. The daily chart has support at $1290, $1285 and significant support is established at the $1270-75 level. R1 sits at $1302, $1306 is the 50.0 Fibonacci level and R2, with the key 61.8 Fibonacci level at 1316. The higher time frames are mixed with the Weekly chart neutral and the Monthly chart positive.
The Crossing EMA Strategy (Daily) breached the 20-day moving average (May 7) and generated T1 at $1294 and T2 also at $1306. The initial Stop Loss was below the 200-day moving average at 1275, which would now have been moved to the entry level at 1284.
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