- Gold probes the upside amid DXY and Treasury yields retreat.
- US stimulus hopes and covid woes underpin XAU/USD.
- Focus on US CPI and political drama amid a likely Trump impeachment
Gold (XAU/USD) extended the bounce from six-week lows on Tuesday, finishing the day with moderate gains well above the $1850 level. The recovery in the metal was enhanced by the retreat in the US dollar across the board, tracking the US Treasury pullback from 1-month highs. Markets assessed the demand for Treasuries amid expectations of a bigger fiscal stimulus under Biden’s presidency. Strong demand for the US bonds in the government auction on Tuesday also added to the downside in the yields. Meanwhile, a likely Trump’s impeachment also somewhat weighed down on the dollar.
Gold looks to build onto Tuesday’s rebound on Wednesday, with all eyes awaiting the US CPI report and the House vote on Trump’s removal from the Office after the deadly Capitol Hill attack. The greenback and the US rates continue their overnight weakness, which is likely to keep gold buoyed. Further, the US stimulus optimism and surging coronavirus cases in the US, Japan and China also boosts gold’s safe-haven appeal. However, the bounce in the global stocks amid a surge in oil prices and stimulus hopes could probably cap the gains in the precious metal. Markets will also pay close attention to the Fedspeak amid recent tapering talks.
Gold Price Chart - Technical outlook
Gold: Hourly chart
As observed in the hourly chart, the gold price is struggling to clear the critical horizontal resistance seen at $1863. Note that the recent sell-off followed by the recovery has charted an ascending triangle pattern on the said timeframe, with $1863 is the likely pattern resistance.
Acceptance above that level could validate the bullish pattern, calling for a test of the bearish 100-hourly moving average (HMA) at $1872. Buyers could then aim for the 200-HMA at $1899.
On the flip side, the 21-HMA at $1854 offers immediate support, below which the 50-HMA at $1850 could guard the downside. The pattern support at $1841 is likely to be tested if the selling pressure intensifies.
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
EUR/USD steady below 1.0800 after US PCE meets expectations
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair barely reacted to US PCE inflation data, with the Greenback shedding some pips. Fed Chair Jerome Powell set to speak ahead of the weekly close.
GBP/USD hovers around 1.2620 in dull trading
GBP/USD trades sideways above 1.2600 amid a widespread holiday restraining action across financial markets. Investors took a long weekend ahead of critical United States employment data next week. Fed Chair Powell coming up next.
Gold price sits at all-time highs above $2,230
Gold price holds near a fresh all-time high at $2,236 in thinned trading amid the Easter Holiday. Most major world markets remain closed, although the United States published core PCE inflation, the Federal Reserve’s favorite inflation gauge.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito (JTO) price has been on an uptrend since forming a local bottom in early January. Since then, JTO has revisited the key swing point formed in early December, suggesting the bulls’ intention to move higher.
Key events in developed markets next week
Next week, the main focus will be inflation and the labour market in the Eurozone. We expect services inflation to be impacted by the easter effect, while the unemployment rate to be unchanged.