Gold Price Forecast: XAU/USD remains under pressure, hits fresh weekly lows under $1780
|- Gold holds negative tone intact amid higher US yields.
- The dollar remains strong after economic data from the US.
- FOMC minutes to be released later on Wednesday ahead of US holiday.
Gold dropped further and printed a fresh two-week low at $1778. It is hovering around $1780 after the release of US economic data, including the Core PCE.
A reversal of a hundred dollars
Gold prices are falling again on Wednesday for the fifth consecutive day. The recovery toward $1800 proved to be short-lived and XAU/USD turned back to the downside. Recently bottomed at $1778, a hundred dollar below last week’s top.
US economic data released on Wednesday came in from mixed to upbeat. Personal Income and Spending rose more than expected in October, initial jobless claims dropped to the lowest since 1969 and consumer sentiment rebounded modestly. On the negative front, Q3 GDP data was revised from 2.2% to 2.1%; Durable Goods Orders fell 0.5%, and New Home Sales rose to 745K (annual rate) below the 800K expected.
US yields remained near weekly highs after the numbers supporting the US dollar in the market and keeping XAU/USD under pressure. At 19:00 GMT the Federal Reserve will released the minutes of its latest meeting.
Short-term outlook
The negative outlook remains intact, particularly with prices breaking and consolidating below every support it recently broke. XAU/USD is back under key moving averages (20, 55, 100 and 200 days). Under $1780, the next support stands at $1770, before the November low at $1758. On the upside, a consolation above $1795, should provide more support for a recovery in prices, that should be seen as a corrective move.
Gold looks set to decline further as no signs of consolidation are seen yet. Although after falling during five consecutive days, technical indicators are showing extreme oversold readings.
Technical levels
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