XAUUSD Current price: $1,661.04

  • Wall Street shrugged off the negative stance while US government bond yields retreated.
  • The dollar’s extreme overbought conditions finally turned into a corrective movement.
  • XAUUSD needs to extend its rally beyond $1,688 to sustain the advance.

XAUUSD bounced from a fresh two-year low of $1,614.81 a troy ounce as dip buyers appeared on the dollar’s extreme overbought conditions. The bright metal peaked at $1,661.57, its highest for the week, holding above the $1,650 mid-US afternoon.

The dollar strengthened throughout the first half of the day on the back of comments from US authorities, pointing out US economic strength. Nevertheless, the greenback changed course with Wall Street’s opening, without a particular catalyst. True, government bond yields have retreated sharply, with the 2-year Treasury note currently yielding 4.13% and the 10-year note, 3.76%, down roughly 20 points.

At the same time, Wall Street shrugged off its negative tone, with major indexes trading in the green. The main focus remains on central banks and whatever policymakers may or may not do to tame inflation without smashing economic progress. Generally speaking, the US seems to be in much better shape than its major counterparts, and the market is playing that game today. Still, the future seems gloomy, as the path towards steady growth is long and bumpy.

Gold price short-term technical outlook

The daily chart for the XAUUSD pair shows that technical indicators have finally left the extreme oversold territory, maintaining their upward slopes but well below their midlines, leaving the current advance as a corrective movement. The 20 SMA keeps heading south below the longer ones, providing dynamic resistance at around $1,683. Gold topped at $1,688 in the previous week, the level to beat for the current rally to become more sustainable.

Gold is losing bullish strength in the near term, according to the 4-hour chart. Technical indicators have turned flat but hold within positive levels, while the 20 SMA has lost its bearish momentum and now consolidates at around $1,635. The longer moving averages, in the meantime, maintain their firmly bearish slopes far above the current level.

Support levels: 1,649.75 1,634.60 1,621.05

Resistance levels: 1,661.70 1,678.50 1,688.00

View Live Chart for XAUUSD  

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended Content


Recommended Content

Editors’ Picks

EUR/USD falls below 1.0500 after US NFP data

EUR/USD falls below 1.0500 after US NFP data

EUR/USD dropped below 1.0450 but managed to stage a modest rebound. The US Dollar preserves its strength against its rivals and doesn't allow the pair to gain traction after the data from the US showed that Nonfarm Payrolls rose by 263,000 in November.

EUR/USD News

GBP/USD turns south on upbeat US jobs report, trades below 1.2200

GBP/USD turns south on upbeat US jobs report, trades below 1.2200

GBP/USD lost nearly 100 pips with the immediate reaction to the upbeat November jobs report from the US and broke below 1.2200. The US Dollar Index clings to strong daily gains above 105.00 after the data showed that Nonfarm Payrolls rose by 263,000.

GBPUSD News

Gold retreats below $1,790 as US yields surge on US NFP

Gold retreats below $1,790 as US yields surge on US NFP

Gold price turned south and dropped below $1,790 in the early American session. The benchmark 10-year US Treasury bond yield is up more than 2% on the day near 3.6% after the bigger-than-expected November job growth, weighing heavily on XAU/USD.

Gold News

FTX exchange collapse, loss of $3.1 billion could have been avoided on one condition

FTX exchange collapse, loss of $3.1 billion could have been avoided on one condition

FTX exchange, founded by Samuel Bankman-Fried (SBF), has consistently made headlines over the past month for its liquidity crisis and triggering a collapse in the crypto ecosystem.

Read more

AMC advances more than 3% in premarket day after being halted

AMC advances more than 3% in premarket day after being halted

AMC stock is up 3.4% in Friday's premarket just a day after authorities halted trading due to unusual volatility. Thursday saw options volume three times higher than the 20-day average.

Read more

Majors

Cryptocurrencies

Signatures