Gold Price Forecast: Lower in range as caution persists

Valeria Bednarik FXStreet

XAU/USD Current price: $1,777.21

Concerns about the Omicron variant maintain markets in risk-off mode.
The ECB and the US Fed will likely announce opposed monetary policy decisions next week.
XAU/USD trades at the lower end of its recent range lacking directional momentum.

Spot gold edged lower for a second consecutive day, trading at around $1,776, after bottoming at $1,773.72 a troy ounce. The bright metal keeps trading within familiar levels under the critical $1,800 threshold, unable to attract investors in risk-off scenarios. The market’s mood remained depressed on Thursday, as concerns related to the coronavirus Omicron variant keeps spooking speculative interest. There have been encouraging reports about the strain’s aggressiveness, alongside discouraging ones related to its virulence. Still, it’s all speculation at this point.

Demand for government bonds dragged yields lower, reflecting the sour sentiment, while global stocks traded mostly in the red. Also, the US Federal Reserve and the European Central Bank will announce their monetary policy decisions next week. And while the Fed is expected to speed up tapering, the ECB is suspected of expanding its pandemic-related financial support program. Investors will likely remain cautious ahead of the decisions.

Gold price short-term technical outlook

XAU/USD offers a neutral-to-bearish stance in its daily chart and has room to extend its slump, although it lacks the strength to do it. Nevertheless, sellers continue defending the upside at around 1,793.00, where the 100 and 200 SMAs converge. At the same time, technical indicators remain directionless within negative levels.

The near-term picture also shows that the risk is skewed to the downside but fails to indicate directional momentum. In the 4-hour chart, gold has extended its decline below its 20 SMA after multiple failed attempts to run beyond it. In the meantime, technical indicators turned flat below their midlines. Gold can accelerate its slump once below 1,772.05, the immediate support level.

Support levels: 1,772.05 1,758.80 1,745.20

Resistance levels: 1,793.00 1,803.85 1,810.65

View Live Chart for the XAU/USD

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to Premium Sign In

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.

EUR/USD holds firm near 1.1850 amid USD weakness

EUR/USD remains strongly bid around 1.1850 in European trading on Monday. The USD/JPY slide-led broad US Dollar weakness helps the pair build on Friday's recovery ahead of the Eurozone Sentix Investor Confidence data for February.

GBP/USD holds medium-term bullish bias above 1.3600

The GBP/USD pair trades on a softer note around 1.3605 during the early European session on Monday. Growing expectation of the Bank of England’s interest-rate cut weighs on the Pound Sterling against the Greenback.

Gold remains supported by China's buying and USD weakness as traders eye US data

Gold struggles to capitalize on its intraday move up and remains below the $5,100 mark heading into the European session amid mixed cues. Data released over the weekend showed that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Fed expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Cardano steadies as whale selling caps recovery

Cardano (ADA) steadies at $0.27 at the time of writing on Monday after slipping more than 5% in the previous week. On-chain data indicate a bearish trend, with certain whales offloading ADA. However, the technical outlook suggests bearish momentum is weakening, raising the possibility of a short-term relief rebound if buying interest picks up.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.