Gold retreats below $1230 as DXY recovers to 95
|- Job openings in the U.S. jump to a record high in August.
- Upbeat data help the greenback retrace its losses.
- Wall Street stages an impressive recovery.
The XAU/USD pair, which rose to its highest level since late July at $1233 before closing at $1226 on Monday, preserved its bullish momentum on Tuesday and, once again, rose above $1230. However, the pair met resistance at $1232 and started to erase its daily gains as the greenback erased its losses on the back of upbeat macroeconomic data releases from the United States. At the moment, the pair is still up 0.15% on the day at $1228.
According to the U.S. Bureau of Labor Statistics, job openings in the U.S. rose to its highest level at 7.1 million in August compared to analysts estimate of 6.9 million. Furthermore, the Fed announced that industrial production increased 0.3% in September with the capacity utilization staying unchanged at 78.1%. After dropping to a new 20-day low at 94.79, the US Dollar Index reversed its course and was last seen flat on the day at 95.04.
Additionally, an improved market sentiment as revealed by the strong upsurge witnessed in stock markets in the NA session seems to be hurting the interest for safe-havens such as gold. At the moment, both the Dow Jones Industrial Average and the S&P 500 indexes are both up 1.3% on the day while the Nasdaq Composite Index is adding 1.6%.
With the absence of significant macroeconomic data releases in the remainder of the day, the pair's price action is likely to continue to get impacted by the risk perception and the markets' USD valuation.
Technical levels to consider
The pair could encounter the first resistance at $1235 (Jul. 26 high) ahead of $1244 (Jul. 17 high) and $1255 (Jul. 11 high). On the downside, supports are located at $1224 (daily low), $1219 (Oct. 15 low) and $1215 (Oct. 12 low).
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