Gold under pressure sub-$1,330 as risk is back on

• Gold bears are trying to keep the market below the $1,330 mark. 
• Investors are disregarding the protectionist threats and the US Dollar gains value.

Gold is trading at around 1,329.31.70 down 0.89% on Tuesday as investors momentarily shrug off the risk-off sentiment ignited on Monday with renewed fears of trade wars between the US and China. Earlier this week, China retaliated to Trump’s tariffs on steel and aluminum by imposing trade tariffs on 128 kinds of US imports worth 3 billion US dollar. 

Meanwhile, the US Dollar Index which is inversely correlated to gold is trading higher flirting with the $90.30 level while the three main Walstreet indices are currently holding Monday’s lows. However, the S&P 500 Index, the tech-heavy Nasdaq and the Dow Jones Industrial Index remain weak as the selloff seen on Monday, April 2 was the worst start to the month of April since the Great Depression.

As gold is taking its cues from geopolitical threats and trade wars, later in the week on Friday will see the release of the Non-Farm Payroll which is most likely going to provide direction for the US Dollar and consequently also to gold. 

Gold weekly chart 

Since the start of 2018 gold is trading in the $1,300-$1350 range above its 50, 100 and 200-period simple moving averages. Since the start of the year, the buyers were unable to close above the $1,350 level while the bears couldn’t close below the $1,313 level. The bull trend is still in place and bulls need to close above $1,350 if they wish to conquer the $1,400 handle. 

Gold 4-hour chart

The bulls failed to bring the market above the 1,345 level at the 23.6% Fibonacci retracement level from the March 21-29 bull move. Gold is currently testing $1,332 at the key 50% Fibonacci level as the momentum is shifting back to bearish. Support is seen at $1,321 swing low and 1,307 cyclical low. Resistance is seen at 1,345 swing high and 1,357 cyclical high.