Gold Price Forecast: Depressed amid a better market mood

Valeria Bednarik FXStreet

XAU/USD Current price: $1,784.55

The American dollar seesaws alongside US government bond yields.
Poor US employment figures ended up boosting Wall Street.
XAU/USD neutral in the near term bears lead as long as below 1,803.

Gold trades with modest losses on Monday, reverting its early strength. The bright metal gapped higher at the daily opening and hit an intraday high of $1,787.79 a troy ounce, currently trading at around $1,784.00. The dollar gained a firmer tone following Wall Street’s opening, as speculative interest moves past the disappointing employment figures posted last Friday. The US managed to create 210K new jobs in November, according to the Nonfarm Payrolls report.

The soft number has taken off some pressure on stocks, as Wall Street suffered from speculation of a tighter monetary policy in the country. US indexes are firmly up on Monday, with the DJIA up over 500 points at the time being. Meanwhile, the yield on the US 10-year Treasury note hovers around 1.40%, up from an intraday low of 1.37%, providing a mild boost to the American currency.

Gold price short-term technical outlook

Gold remains subdued, not far from its November low at $1,758.81 a troy ounce, the immediate support level. Technically speaking the bright metal is at risk of falling, as the daily chart shows that XAU/USD remains below all of its moving averages, with the 100 and 200 SMAs converging directionless at around 1,792.00. Technical indicators have bounced modestly from their recent lows, but remain well into negative levels without clear directional strength.

The near term picture is neutral, as the 4-hour chart shows that technical indicators are stuck around their midlines, as the metal hovers around a flat 20 SMA. The longer moving averages remain above the 1,800 figure, slowly gaining bearish strength.

Support levels: 1,758.80 1,745.20 1,734.90

Resistance levels: 1,792.00 1,803.85 1,810.65

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.

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