Gold Price Forecast: Buyers defending the 1,750 price zone

Valeria Bednarik FXStreet

XAU/USD Current price: $1,760.52

A better market mood limits demand for safe-haven gold.
Upbeat US data provided support to high-yielding equities.
XAU/USD could advance in the near term, although sustained gains seem unlikely.

Gold has trimmed all of its Monday’s gains and trades just below the 1,760 price zone, although off its daily lows. Demand for the bright metal receded amid a better performance of equities, reflecting a better market’s mood. The American dollar also remained away from investors’ radar, shedding ground against other major currencies.

Better than anticipated US data lifted further the market’s sentiment, as the September ISM Services PMI improved from 61.7 to 61.9, much better than the 60 expected. Services businesses activity in the country improved for the 16th month in a row, although the official report also showed rising concerns about bottlenecks and constraints on logistics, alongside “challenges with labour resources.”

Meanwhile, US government bond yields surged to a fresh weekly high, another sign of a better market mood. The yield on the 10-year Treasury note peaked t 1.54% and currently stands at 1.52%.

Gold price short-term technical outlook

XAU/USD keeps trading between Fibonacci levels. The daily chart shows that gold was unable to retain gains above a bearish 20 SMA and currently trades below it, meeting buyers for a third consecutive day around the 23.6% retracement of its latest daily slump at 1,748.05. Technical indicators are directionless within negative levels, with the RSI slowly turning south.

For the near term, the outlook is neutral-to-bullish as XAU/USD is standing above a bullish 20 SMA, while technical indicators aim higher from around their midlines. The 100 SMA maintains a modest bearish slope near the next Fibonacci resistance level at 1,764.35, the level to beat to expect additional gains in the upcoming sessions.

Support levels: 1,748.05 1,735.26 1,721.60

Resistance levels: 1,764.35 1,777.75 1,787.30

View Live Chart for the XAU/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

AUD/USD remains below 0.7000 amid light trading

AUD/USD fills a modest bearish gap on Monday, but remains below 0.7000 in the Asian session amid holiday-thinned liquidity. The US Dollar attempts a bounce even as US bond yields pull back from multi-year highs, limiting the pair. Moreover, diminishing odds of another RBA rate hike in November cap the Aussie.

USD/JPY hovers above 158.00 amid Japan/ US holiday

USD/JPY extends its range-bound price action into a new week, trading above 158.00 as bulls remain on high alert amid speculation that authorities will step in to prop up the Japanese Yen. Meanwhile, softer US bond yields keep US Dollar bulls on the back foot and cap the pair's upside. However, geopolitical uncertainties could limit losses for the safe-haven buck amid thin liquidity due to a holiday in Japan and the US.

Gold remains vulnerable below $4,200 on Fed hike bets

Gold is under mild selling pressure on Monday, trading at around $4,170. The US Dollar advances modestly in thin trading, supported by bets that the Federal Reserve will hike rates at least one more time before year-end.

Bitcoin struggles as ETF outflows, geopolitical uncertainty weigh

Bitcoin hovers around $83,600 on Monday after a 3.1% correction last week. US-listed spot ETFs recorded an outflow of $681.10 million last week, snapping the three-week inflow streak. Geopolitical uncertainty and mixed signals keep investors cautious.

The week ahead: A critical week as earnings and CPI test market

The Oil price is relatively stable this morning, and US and European stock markets are poised to open higher, as risk sentiment shrugs off an escalation in the Middle East and concerns about rising bond yields.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?