XAU/USD Current price: $1,946.67
- Risk aversion continues to favor the Greenback as US lawmakers struggle to clinch a deal.
- The US Gross Domestic Product was upwardly revised in Q1 from 1.1% to 1.3%.
- XAU/USD remains at the lower end of its monthly range, with lower lows in sight.
Gold has broken below the 50% retracement of the March/May rally at $1,943.86, bottoming during European trading hours at $1,930.20. XAU/USD bounced from the level but is struggling to recover above it.
The US Dollar continued to find support in a dismal market mood but also benefited from upbeat United States macroeconomic figures. The country upwardly revised its Q1 economic growth, and the annualized figure now stands at 1.3%, according to the Gross Domestic Product (GDP) report. On the one hand, the number suggests the country may avoid a recession, yet on the other, it opens the door for another round of rate hikes to tame inflation.
As a result, the American currency preserved its former strength, while stock markets held on the back foot amid concerns about the US debt-ceiling limit. President Joe Biden and top Republicans are engaged in negotiations in which the opposition demands spending cuts to agree on an extension of the debt ceiling. House Speaker Kevin McCarthy crossed the wires this Thursday, saying they have made some progress, although dismissing chances they could reach a deal today.
XAU/USD price short-term technical outlook
XAU/USD hovers around $1,945, down for a second consecutive day. Technical readings in the daily chart maintain the risk skewed to the downside, as the pair fell further below a now bearish 20 Simple Moving Average (SMA) while steadily approaching a directionless 100 SMA, currently providing dynamic support at around 1,933.70. At the same time, the Momentum indicator pared its decline but remains dip into the red, while the Relative Strength Index (RSI) indicator maintains its downward slope near 30, supporting another leg south.
The 4-hour chart shows that Gold develops below bearish moving averages, with the 20 SMA accelerating its decline and currently at around $1,965.20. Technical indicators have turned flat but remain well below their midlines without signs of changing course. The 61.8% retracement of the aforementioned rally stands at 1,911.97, a potential bearish target for the upcoming sessions.
Support levels: 1,933.70 1,912.00 1,901.80
Resistance levels: 1,954.90 1,965.20 1,972.00
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.
Recommended Content
Editors’ Picks
AUD/USD holds above 0.6500 in thin trading
The Australian Dollar managed to recover ground against its American rival after AUD/USD fell to 0.6484. The upbeat tone of Wall Street underpinned the Aussie despite broad US Dollar strength and tepid Australian data.
EUR/USD comfortable below 1.0800 lower lows at sight
The EUR/USD pair lost ground on Thursday and settled near a fresh March low of 1.0774. Strong US data and hawkish Fed speakers comments lead the way ahead of the release of the US PCE Price Index on Friday.
Gold pulls away from daily highs, holds above $2,200
Gold retreats from daily highs but holds comfortably above $2,200 in the American session on Thursday. The benchmark 10-year US Treasury bond yield stays near 4.2% after upbeat US data and makes it difficult for XAU/USD to gather further bullish momentum.
Google starts indexing Bitcoin addresses
Bitcoin address data is live on Google search results after users realized on Thursday that the tech giant started indexing Bitcoin blockchain data. However, mixed reactions have followed the tech giant's reversed stance on the cryptocurrency.
A Hollywood ending for fourth quarter GDP
The latest revisions put Q4 GDP at 3.4%, the second fastest quarterly growth rate in two years. Much of the upside was attributable to stronger consumer spending, yet fresh profits data affirmed it was a good quarter for the bottom line as well with profits up by the most since the Q2-2022.