Gold again faces rejection above $1,810
- Gold has retreated to $1,808 from the session high of $1,813.
- A sustained break above $1,810 remains elusive as the dollar draws bids.
- Upbeat China GDP may weaken the haven demand for the yellow metal.
Gold bulls continue to struggle to establish a strong foothold above $1,810.
At press time the yellow metal is trading largely unchanged on the day at $1,809, having faced rejection at $1,813 early Thursday. The safe-haven metal has failed to keep gains above $1,810 in four out of the last five trading days.
Indecisive market
Wednesday’s Doji candle is suggestive of indecision in the marketplace. Some may argue that the Doji candle has appeared at multi-year highs and represents buyer exhaustion.
While that could be the case, so far, the downside has been capped near $1,808. Besides, the yellow metal is trading well within Wednesday’s trading range of $1,815-$1,802. Acceptance below $1,802 would confirm a short-term bearish reversal.
Wednesday’s low could come into play during the day ahead, as the US dollar, gold’s biggest nemesis, is flashing green. At press time, the dollar index, which tracks the value of the greenback against majors, is trading at 96.14, representing 0.10% gain on the day. The dollar seems to be drawing haven bids on account of the escalating US-China tensions and the 0.5% decline in the S&P 500 futures at press time.
Further, haven demand for gold may weaken, allowing bears to push prices lower, as data released at 02:00 GMT showed China’s economy returned to growth in the second quarter.
Gold, however, may pick up a bid during the American trading hours if the US retail sales data misses expectations by a big margin, sending the US dollar lower.
Technical levels
Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
