Gold prices edged higher on Wednesday as the dollar eased paving the way for higher gold prices. US yields moved higher as riskier assets such as equities rose, following Tuesday’s hammering of stock prices. The Brexit fallout between the UK and the EU continued to widen which is helping to buoy safe-haven assets like gold.
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Gold prices rebounded and edge through resistance near the 10-day moving average near 1,944. Prices bounced off of support on Wednesday which is seen near the 50-day moving average at 1,912. Medium-term negative momentum is decelerating as the MACD histogram is printing in the red with a rising trajectory which points to consolidation. Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. The relative strength index is moving sideways to higher which is a sign of accelerating positive momentum.
Brexit Issues are Rising
The gap between the EU and UK are widening. Reports say that two of the UK government’s most senior legal advisors quit over professed plans to remove portions of the Brexit Withdrawal Agreement. More specifically, the UK plans to revoke its agreement to keep Northern Ireland aligned with EU customs rules. This is generating volatility in the UK markets and helping to buoy gold prices.