XAU/USD pair – Daily Chart

XAUUSD

Gold prices in terms of US dollar (XAU/USD) witnessed a massive sell-off on Thursday, dropping nearly $ 30 and retested fresh weekly lows at 1176.93. XAU/USD dropped from $ 1207 highs, breaking below all the moving averages as traders unwound their gold longs on month ending while upbeat US jobless claims, PCE inflation and Chicago PMI numbers lifted the greenback from two-months trough, dragging XAU/USD lower to settle at 1184.50.

Currently, XAU/USD has formed ascending triangle formation on the daily chart and wavers around the triangle support located at 1181.20. The pair failed to sustain at higher levels at 1185.31 and languishes near lows as the broad US dollar strength continues to dominate amid a data-light European session. Meanwhile, traders prefer to hold the reserve currency following upbeat US macro data released yesterday and also ahead of the major US data flow due later in the session. Stronger greenback makes gold expensive for the holders of the yellow metal in foreign currency.

Further on the daily chart, RSI at 44 aims lower below the mid lines indicating further rooms for decline. The pair may also display an ascending triangle break out on the downside if the US dollar resumes its upward moves on the upcoming data releases. To the downside, the pair may test the daily lows at 1180.58 and could extend decline to the next support at 1175 below a break of this last. Trading volumes are expected to be thin as Europe remains closed on Labour Day, which may limit gains and losses in the pair. To the upside, the pair faces stiff resistance at 50-DMA located at 1191.50 levels and beyond that it could test 5-DMA located around 1195 levels. Overall, XAU/USD is poised for a break down and extend losses as broad USD strength is likely to persist.


XAU/JPY pair – Daily Chart

XAUJPY

Gold prices in terms of Japanese yen (XAU/JPY) failed to breach the crucial resistance at 143,500 levels and slipped back lower to finish Thursday at 141,525 levels. The XAU/JPY pair was relentlessly offered yesterday, despite yen weakness later in the US session, as reversal in the US dollar supported by above estimates US economic data boosted risk-on moods, hurting gold’s appeal as a safer bet. However, the pair remained well supported above the trend line support at 140,125 after getting rejected near 20-DMA.

Currently, XAU/JPY trades lifted near highs around 141,700 levels largely on yen weakness versus the US dollar as the greenback continues to ride higher on the latest impressive set of US data. The pair has formed a small doji on daily chart indicating that markets await the upcoming US macro releases for further cues on the USD moves. The technical indicator in RSI stands flat 45 backing the case for a wait and watch mode within the markets. However, the upside breakout in the pair looks like a more likely bet given the latest weak inflation print from Japan which is expected to keep the yen undermined while upbeat data-backed strength may further boost the USD bulls.

To the upside, the pair may edge higher and retest 5-DMA located at 142,681, beyond a sustained break above 142k barrier. However, the gains may remain capped as broad USD strength may weigh on safe havens like gold as mentioned earlier. To the downside, XAU/JPY may test previous lows at 140,600 levels and may drop further to the trend line support at 140,180 levels below a break of the last. Overall, a generalized intraday upside bias persists so long as 141k handle holds.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended Content


Recommended Content

Editors’ Picks

AUD/USD: A tough barrier remains around 0.6800

AUD/USD: A tough barrier remains around 0.6800

AUD/USD failed to maintain the earlier surpass of the 0.6800 barrier, eventually succumbing to the late rebound in the Greenback following the Fed’s decision to lower its interest rates by 50 bps.

AUD/USD News
NZD/USD advances to near 0.6200 due to risk-on mood, Fed interest rate decision awaited

NZD/USD advances to near 0.6200 due to risk-on mood, Fed interest rate decision awaited

The NZD/USD pair edges lower to near 0.6200 during the early Asian session on Thursday. The recent GDP data revealed that New Zealand's economy shrank again in the second quarter, suggesting the depths of its economic malaise.

NZD/USD News
Gold surrenders gains and drops to weekly lows near $2,550

Gold surrenders gains and drops to weekly lows near $2,550

Gold prices reverses the initial uptick to record highs around the $$2,600 per ounce troy, coming under renewed downside pressure and revisiting the $2,550 zone amidst the late recovery in the US Dollar.

Gold News
Australian Unemployment Rate expected to hold steady at 4.2% in August

Australian Unemployment Rate expected to hold steady at 4.2% in August

The Australian Bureau of Statistics will release the monthly employment report at 1:30 GMT on Thursday. The country is expected to have added 25K new positions in August, while the Unemployment Rate is foreseen to remain steady at 4.2%.

Read more
Ethereum could rally to $2,817 following Fed's 50 bps rate cut

Ethereum could rally to $2,817 following Fed's 50 bps rate cut

Ethereum (ETH) is trading above $2,330 on Wednesday as the market is recovering following the Federal Reserve's (Fed) decision to cut interest rates by 50 basis points. Meanwhile, Ethereum exchange-traded funds (ETF) recorded $15.1 million in outflows.

Read more
Moneta Markets review 2024: All you need to know

Moneta Markets review 2024: All you need to know

VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.

Read More

Majors

Cryptocurrencies

Signatures