- Gold price is regaining upside traction early Thursday, despite a firmer US Dollar.
- US Treasury bond yields are falling on uncertainty around the Fed interest rate outlook.
- Gold price makes another attempt to regain 21-day SMA as RSI stays bullish.
Gold price is seeing renewed demand early Thursday, trading back above $1,960 amid a fresh selling in the US Treasury bond yields. Meanwhile, a steady recovery in the United States Dollar (USD), in the wake of tepid risk sentiment, appears to be limiting the Gold price rebound, thus far.
Gold price remains at the mercy of risk trends, Fedspeak
Investors turned risk-averse in the Asian session on Thursday after China’s property market concerns resurfaced, following the release of disappointing Chinese Fixed Asset Investment data. The main factor behind the cautious mood is the uncertainty surrounding the US Federal Reserve (Fed) interest rate outlook. The softer US Consumer Price Index (CPI) reinforced expectations that the Fed interest rate cuts are coming earlier than expected next year.
However, the above-forecast US Retail Sales data and cooling factory-gate inflation seen on Wednesday brought the Fed’s ‘higher interest rates for longer’ narrative back on the table, supporting the US Dollar while capping the upside attempts in Gold price. Retail sales, which are adjusted for seasonality but not inflation, fell 0.1% in October from the prior month, the US Commerce Department reported Wednesday. The estimate was for a drop of 0.3% in the reported period. Markets now believe that Fed could refrain from cutting interest rates on strengthening signs of an economic 'soft landing'.
Meanwhile, the US Treasury bond yields are feeling the heat from increased demand for safe-havens such as the US government bonds, keeping the buoyant tone intact around the non-yielding Gold price.
Looking ahead, Gold traders will take cues from the mid-tier US weekly Jobless Claims data and a slew of speeches from Fed policymakers.
Gold price technical analysis: Daily chart
The 21-day Simple Moving Average (SMA) at $1,975 remains a tough nut to crack for Gold buyers.
However, the 14-day Relative Strength Index (RSI) remains above the midline, keeping Gold buyers hopeful.
Daily closing above the 21-day SMA at $1,975 is needed for a sustained upside toward the November 6 high of $1,993, above which the $2,000 mark will be retested.
Conversely, retracements from higher levels are likely to challenge initial demand around $1,960, below which the $1,950 psychological level.
The 200-day SMA at $1,936 could offer strong support to Gold optimists.
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.