XAU/USD outlook: Recovery extension above $5,000 improves near-term picture and boosts optimism

Slobodan Drvenica Windsor Brokers

XAU/USD

Gold regained levels above $5000 on Wednesday as strong recovery extends into second consecutive day (metal was up almost 6% on Tuesday, in the biggest daily gain in years).

Brief pause in geopolitical stage (one of gold’s key drivers nowadays) which sparked the latest correction, is likely over as renewed tensions between the US and Iran revived safe-haven demand and lifted the price from dangerous zone.

The situation on daily chart boosts optimism on signals about likely end of correction as pullback from new record high ($5598) repeatedly closed above Fibo 38.2% of $5598/$4402 ($4652) after spike lower found support above 50% retracement, reinforced by the top of ascending daily Ichimoku cloud.

This signaled a healthy correction of larger uptrend that provided better levels to re-enter bullish market, which subsequently accelerated recovery.

Technical picture improved as 14-d momentum bounced after reversal just above the centreline and RSI rose above 50 zone, while the price rose above daily Tenkan/Kijun-sen in bullish configuration.

Daily close above $5000 (psychological/50% retracement/daily Tenkan-sen) is required to confirm bullish signal and keep fresh bulls intact for attacks at initial barriers at $5100/41 (round-figure/Fibo 61.8% of $5598/$4402), guarding $5314 (Fibo 76.4%).

Failure to sustain gains above $5000 would allow dips above $4936 (daily Kijun-sen) that would keep near-term bias with bulls.

Res: 5100; 5141; 5200; 5316.
Sup: 5000; 4936; 4900; 4859.

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

EUR/USD looks vacillating above 1.1800

EUR/USD alternates gains with losses in the low-1.1800s on Wednesday in a context of modest gains in the Greenback. Meanwhile investors continue to assess the latest advanced inflation data in the euro area and the lower-than-expected weekly ADP figures on the US calendar. Later in the day, all the attention should be on the release of the US ISM Services.

GBP/USD keeps the bid bias above 1.3700

GBP/USD builds on Tuesday’s gains, advancing for the second day in a row and reclaiming the 1.3700 barrier and above on Wednesday. Furthermore, Cable’s uptick comes despite decent gains in the Greenback ahead of the BoE’s Super Thursday.

Gold extends the rebound above $5,000

Gold picks up further pace and retests the area above the key $5,000 mark per troy ounce on Wednesday. The precious metal’s extra advance comes despite the firmer US Dollar and rising US Treasury yields across the curve, while fresh geopolitical effervescence appears to support the metal’s improvement.

Crypto Today: Bitcoin, Ethereum, XRP tick up despite macro uncertainty, retail exodus

Bitcoin rises above $76,000 following an extended decline to $72,946 the previous day as Fed-related headlines keep investors on edge. Ethereum advances toward the $2,300 hurdle amid low retail interest, with futures Open Interest falling to $26.3 billion.

Should investors abandon AI as software stocks slide?

AI is not being abandoned by markets. It is being priced more carefully. Over the past few weeks, the underperformance of software and SaaS stocks has sparked a familiar question: is the AI trade breaking down? The answer is no.

Ripple stabilizes amid mixed signals as ETF inflows resume despite low retail activity

Ripple hovers around the $1.60 pivotal level at the time of writing on Wednesday, reflecting stable but weak sentiment across the crypto market. Intense volatility triggered a brief sell-off on Tuesday, driving the remittance token to pick up liquidity at $1.53 before recovering to the current level.