Gold makes tracks on slight risk off tone, heading to $1,290?
- Gold is supported in a slight risk-off tone.
- Wall Street is cooling off as bulls take a rest.
- Trump's trip to Asia causing some risk -off play.
- US tax reform weighs on risk sentiment.
Gold is up through the 200-4hr SMA at $1,281.36, supported on the bounce by the 100-D SMA at $1,279.89. Meanwhile, DXY is off its highs and now printing in the red at -0.04% at the time of writing and the stocks on Wall Street are cooling off on Wednesday.
US Tsy Sec. Mnuchin: Aim is to get tax bill to Pres. Trump in December
Uncertainty about US tax reform is weighing on the dollar, explained analysts at BBH. "The Washington Post reports that the Senate version might delay the corporate tax cut until 2019. Other major changes include eliminating the so-called SALT deduction, marking a very different version than the House version. We have always warned that nothing is written in stone, but the stark differences shaping up in the two versions suggests a very difficult period of negotiating ahead." Also, Trump's trip to Asia is sparking some risk-off play here. USD/JPY is trading to the downside with 113.39 lows made recently and US yields are lower, helping gold make fresh highs on Wednesday.
$1290 comes as the next major obstacle ahead of $1300 ( the psychological pivot). On the downside, supports could be encountered at $1276 (100-D SMA), $1260 (Oct. 6 low) and $1251 (Aug. 8 low).