Share:

XAU/USD Current price: $2,036.15

  • Surprising dovish comments from US Federal Reserve officials hit the US Dollar.
  • US Treasury bond yields extend their slide to fresh multi-week lows.
  • XAU/USD soared on broad US Dollar weakness could extend the rally towards $2,075.

Gold prices extended gains on Tuesday, with XAU/USD trading as high as $2,038.45 after Wall Street's opening, currently holding nearby. The US Dollar has remained under selling pressure since the day started, accelerating its slump following comments from Federal Reserve (Fed) Governor Christopher Waller, delivering some dovish words.

Waller said the recent slowdown in economic activity is encouraging, as it may indicate that the monetary policy is tight enough to contain inflation. Furthermore, Wall said that if inflation continues to fall for several more months, the central bank could lower the policy rate.

 Beforehand, Chicago Fed President Austan Goolsbee said overall, there has been progress on inflation, noting that "it's been coming down, it's not yet down to target but 2023 we're on path to set the highest drop in the inflation rate in 71 years."

Finally, and retaining the hawkish stance, Fed Governor Michelle Bowman noted another rate hike is still possible, particularly if inflation progress stalls.

The majority shift from the usual hawkish message from Fed officials pushed Treasury yields further down. Currently, the 10-year government note offers 4.36%, while the 2-year note yields 4.80%, both down on the day.

XAU/USD short-term technical outlook

The XAU/USD pair maintains the upward pressure and could reach higher highs in the near term. The daily chart shows that technical indicators aim firmly north within positive levels, with the Relative Strength Index (RSI) indicator already within overbought levels. At the same time, the bright metal soared beyond directionless moving averages, with the 20 Simple Moving Average currently at around $1,980.

Gold is firmly bullish in the near term. The 4-hour chart shows technical indicators aim north almost vertically, standing at extreme levels yet without signs of upward exhaustion. Meanwhile, the 20 SMA has accelerated north well below the current level, while above bullish 100 and 200 SMAs, reflecting strong buying interest. The main bullish target for XAU/USD is $2,074.87, the August 2020 monthly high.

Support levels: 2,048.20 2,062.90 2,074.90

Resistance levels: 2,021.40 2,005.70 1,991.45

View Live Chart for XAU/USD  

Share: Feed news

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.

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content

Editors’ Picks

EUR/USD stabilizes above1.0800, looks to post weekly gains

EUR/USD stabilizes above1.0800, looks to post weekly gains

EUR/USD continues to trade in a tight channel above 1.0800 in the second half of the day on Friday, as the improving risk mood makes if difficult for the USD to gather strength. The pair remains on track to snap a five-week losing streak.

EUR/USD News

GBP/USD clings to modest daily gains above 1.2650

GBP/USD clings to modest daily gains above 1.2650

GBP/USD trades in positive territory above 1.2650 in the American session on Friday. The bullish opening in Wall Street doesn't allow the USD to gather strength and helps the pair stay on track to close higher for the fifth consecutive day.

GBP/USD News

Gold holds steady above $2,020 as US yields edge lower

Gold holds steady above $2,020 as US yields edge lower

Gold regained its traction and stabilized above $2,020 after falling below this level during the European trading hours. The benchmark 10-year US Treasury bond yield is down nearly 1% on the day below 4.3%, allowing XAU/USD to keep its footing heading into the weekend.

Gold News

Ethereum price risks decline as increasing exchange supply raises chances of profit taking

Ethereum price risks decline as increasing exchange supply raises chances of profit taking

Ethereum price crossed $3,000 several times this week but the altcoin failed to sustain above this key level, raising concerns regarding its price trend. ETH price faces the risk of decline as the supply of the altcoin on exchanges is on the rise. 

Read more

Up go stocks, down go bonds

Up go stocks, down go bonds

We knew that yesterday was going to be a good day – at least for the stock markets, given that Nvidia defied the expectations that it would - maybe – fail to deliver $20bn sales in the latest quarter. 

Read more

Majors

Cryptocurrencies

Signatures