Gold Price Forecast: XAU/USD eyes $1980 amid weaker dollar, focus shifts to Wednesday’s FOMC
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get Premium without limits for only $9.99 for the first month
Access all our articles, insights, and analysts.
UNLOCK OFFER- Gold regains poise, as the risk-recovery downs the US dollar.
- Upbeat Chinese data, vaccine hopes and fresh US-Sino optimism lift the mood.
- Growing Brexit risks to underpin Gold ahead of US data, FOMC decision.
Gold (XAU/USD) built on Monday’s 1% rally after a steady start on Tuesday, reaching fresh nine-day highs at $1967. The US dollar was dumped across the board amid an improvement in the risk-sentiment, courtesy of the vaccine hopes, upbeat Chinese data and renewed US-Sino trade optimism. The Chinese activity numbers came in stronger than the estimates, suggesting the economic recovery is gathering steam. Also, news that China extended tariffs exemptions on some of the US good imports further fuelled the market optimism.
Traders now look forward to the US Industrial Production data and the sentiment on Wall Street for fresh trading impetus. Dovish Federal Reserve (Fed) expectations ahead of Wednesday’s monetary policy decision could also bode well for the XAU bulls.
Gold: Short-tern technical outlook
Hourly chart
The hourly Relative Strength Index (RSI) peeps into the overbought territory, currently at 71.20, suggesting extra room for the upside. The bullish crossover of 21-hourly Simple Moving Average (HMA) and 50-HMA overnight adds credence to the fresh leg higher in the bright metal.
The path of least resistance is to the upside, as the next target for the bulls awaits at $1970. The price trades above all the major HMAs.
To the downside, Monday’s high of $1962 will offer immediate support on any pullbacks. A break below which the aforementioned pattern resistance now cushion could limit the losses. The next cap is seen at the bullish 21-HMA at $1955.
Acceptance below the latter could intensify the bearish pressure, opening floors towards the upward-sloping 50-HMA, now at $1949.
- Gold regains poise, as the risk-recovery downs the US dollar.
- Upbeat Chinese data, vaccine hopes and fresh US-Sino optimism lift the mood.
- Growing Brexit risks to underpin Gold ahead of US data, FOMC decision.
Gold (XAU/USD) built on Monday’s 1% rally after a steady start on Tuesday, reaching fresh nine-day highs at $1967. The US dollar was dumped across the board amid an improvement in the risk-sentiment, courtesy of the vaccine hopes, upbeat Chinese data and renewed US-Sino trade optimism. The Chinese activity numbers came in stronger than the estimates, suggesting the economic recovery is gathering steam. Also, news that China extended tariffs exemptions on some of the US good imports further fuelled the market optimism.
Traders now look forward to the US Industrial Production data and the sentiment on Wall Street for fresh trading impetus. Dovish Federal Reserve (Fed) expectations ahead of Wednesday’s monetary policy decision could also bode well for the XAU bulls.
Gold: Short-tern technical outlook
Hourly chart
The hourly Relative Strength Index (RSI) peeps into the overbought territory, currently at 71.20, suggesting extra room for the upside. The bullish crossover of 21-hourly Simple Moving Average (HMA) and 50-HMA overnight adds credence to the fresh leg higher in the bright metal.
The path of least resistance is to the upside, as the next target for the bulls awaits at $1970. The price trades above all the major HMAs.
To the downside, Monday’s high of $1962 will offer immediate support on any pullbacks. A break below which the aforementioned pattern resistance now cushion could limit the losses. The next cap is seen at the bullish 21-HMA at $1955.
Acceptance below the latter could intensify the bearish pressure, opening floors towards the upward-sloping 50-HMA, now at $1949.
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.