Gold Price Forecast: XAU/USD steady near it recent lows
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UPGRADEXAU/USD Current price: $3,962.50
- The US Dollar remains firm as investors continue diggesting Fed’s announement.
- The Reserve Bank of Australia kept rates on hold following the November meeting.
- XAU/USD under modest selling pressure, scope to extend its slide.
Spot Gold trades with a soft on Tuesday, currently hovering around $3,965 a troy ounce. The bright metal seems unable to attract speculative interest, despite the dominant cautious mood, with investors preferring to add US Dollar (USD) longs.
The poor performance of global equities does not seem enough to boost demand for XAU/USD, which, anyway, remains confined to tight intraday ranges for a second consecutive week.
As for the Greenback, demand remains firm following the Federal Open Market Committee (FOMC) monetary policy announcement last week, in which policymakers cooled down expectations for a December interest rate cut. The United States (US) federal government ran out of funding on October 1, and ever since, thousands of workers have been furloughed or laid off.
Furthermore, statistical offices have remained closed, without conducting the usual surveys that provide information on employment, inflation, and growth, among other key indicators. Federal Reserve (Fed) officials are concerned about the weak labor market, but they have also acknowledged the recent uncertainty stemming from the lack of official data.
Other than that, the USD found near-term support after the Reserve Bank of Australia (RBA) held the Official Cash Rate (OCR) steady at 3.6%, as expected. The accompanying statement showed that policymakers believe that underlying inflation remains too high, adding that policy is now “closer to neutral” but still acting to contain demand. As a result, the Australian Dollar (AUD) edged sharply lower.
The macroeconomic calendar will include on Wednesday, the New Zealand monthly employment report, and the US ISM Services Purchasing Managers’ Index (PMI).
XAU/USD short-term technical outlook
In the 4-hour chart, XAU/USD is currently trading at around $3,963, down for the day. Spot remains capped beneath all key moving averages, keeping the near-term bias tilted lower. The 20 SMA has rolled over and stands at $4,002, sitting below a descending 100 SMA at $4,105, while the 200 SMA is advancing at $3,988. Technical indicators confirm the downward bias, as the Momentum indicator remains in negative territory and below its mid-line, signaling ongoing selling pressure even if the latest downdraft has moderated, while the RSI stands at 41, suggesting sellers retain the upper hand despite a modest uptick.
In the daily chart, XAU/USD develops below a mildly bullish 20 SMA now at $4,088. At the same time, the longer moving averages remain below the current level, providing longer-term support: the 100 SMA develops around $3,596, while the 200 SMA climbs to $3,359, underpinning the broader uptrend. Finally, the Momentum indicator has accelerated south, well below its 100 mid-line, while the RSI indicator has slipped to 48, indicating fading bullish strength and skewing the risk to the downside. Taken together, oscillators warn of a corrective phase while trend metrics stay positive; a daily close above the 20 SMA at $4,088 would likely revive the bullish bias, whereas failure to reclaim it could keep pressure toward dynamic support at $3,596/$3,359.
(This content was partially created with the help of an AI tool)
XAU/USD Current price: $3,962.50
- The US Dollar remains firm as investors continue diggesting Fed’s announement.
- The Reserve Bank of Australia kept rates on hold following the November meeting.
- XAU/USD under modest selling pressure, scope to extend its slide.
Spot Gold trades with a soft on Tuesday, currently hovering around $3,965 a troy ounce. The bright metal seems unable to attract speculative interest, despite the dominant cautious mood, with investors preferring to add US Dollar (USD) longs.
The poor performance of global equities does not seem enough to boost demand for XAU/USD, which, anyway, remains confined to tight intraday ranges for a second consecutive week.
As for the Greenback, demand remains firm following the Federal Open Market Committee (FOMC) monetary policy announcement last week, in which policymakers cooled down expectations for a December interest rate cut. The United States (US) federal government ran out of funding on October 1, and ever since, thousands of workers have been furloughed or laid off.
Furthermore, statistical offices have remained closed, without conducting the usual surveys that provide information on employment, inflation, and growth, among other key indicators. Federal Reserve (Fed) officials are concerned about the weak labor market, but they have also acknowledged the recent uncertainty stemming from the lack of official data.
Other than that, the USD found near-term support after the Reserve Bank of Australia (RBA) held the Official Cash Rate (OCR) steady at 3.6%, as expected. The accompanying statement showed that policymakers believe that underlying inflation remains too high, adding that policy is now “closer to neutral” but still acting to contain demand. As a result, the Australian Dollar (AUD) edged sharply lower.
The macroeconomic calendar will include on Wednesday, the New Zealand monthly employment report, and the US ISM Services Purchasing Managers’ Index (PMI).
XAU/USD short-term technical outlook
In the 4-hour chart, XAU/USD is currently trading at around $3,963, down for the day. Spot remains capped beneath all key moving averages, keeping the near-term bias tilted lower. The 20 SMA has rolled over and stands at $4,002, sitting below a descending 100 SMA at $4,105, while the 200 SMA is advancing at $3,988. Technical indicators confirm the downward bias, as the Momentum indicator remains in negative territory and below its mid-line, signaling ongoing selling pressure even if the latest downdraft has moderated, while the RSI stands at 41, suggesting sellers retain the upper hand despite a modest uptick.
In the daily chart, XAU/USD develops below a mildly bullish 20 SMA now at $4,088. At the same time, the longer moving averages remain below the current level, providing longer-term support: the 100 SMA develops around $3,596, while the 200 SMA climbs to $3,359, underpinning the broader uptrend. Finally, the Momentum indicator has accelerated south, well below its 100 mid-line, while the RSI indicator has slipped to 48, indicating fading bullish strength and skewing the risk to the downside. Taken together, oscillators warn of a corrective phase while trend metrics stay positive; a daily close above the 20 SMA at $4,088 would likely revive the bullish bias, whereas failure to reclaim it could keep pressure toward dynamic support at $3,596/$3,359.
(This content was partially created with the help of an AI tool)
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