Gold clings to modest gains above $1870 level, remains vulnerable


  • Gold gained some positive traction on Friday and moved away from one-month lows.
  • A subdued USD price action, weaker risk sentiment remained supportive of the uptick.
  • The set-up supports prospects for additional weakness and warrants caution for bulls.

Gold traded with a mild positive bias through the first half of the European session, albeit lacked any follow-through and was seen oscillating in a range just above the $1870 level.

A combination of supporting factors assisted the precious metal to gain some positive traction on the last trading day of the week and move away from one-month lows set in the previous session. The US dollar bulls refrained from placing fresh bets amid the uncertainty over the outcome of the US presidential election. This, in turn, was seen as one of the key factors lending some support to the dollar-denominated commodity.

Apart from this, concerns about the economic fallout from new restrictions to curb the second wave of the coronavirus infections weighed on investors' sentiment and drove some haven flows towards the XAU/USD. The risk-off mood was evident from a fresh leg down in the US equity futures and reinforced by sliding US Treasury bond yields, which further benefitted the non-yielding yellow metal and remained supportive of the uptick.

Despite the supporting factors, the XAU/USD lacked any strong bullish conviction and remained well within the previous day's broader trading range. Even from a technical perspective, the overnight fall added credence to this week's bearish break below 100-day SMA – for the first time since March. This warrants some caution for aggressive bullish traders and positioning for any meaningful near-term appreciating move for the commodity.

Moving ahead, market participants now look forward to the second-tier US economic releases – Core PCE Price Index, Chicago PMI and revised Michigan Consumer Sentiment. The data, along with the broader market risk sentiment, will influence the USD price dynamics and produce some meaningful trading opportunities on the last day of the week.

Technical levels to watch

XAU/USD

Overview
Today last price 1872.7
Today Daily Change 4.84
Today Daily Change % 0.26
Today daily open 1867.86
 
Trends
Daily SMA20 1901.01
Daily SMA50 1916.89
Daily SMA100 1888.15
Daily SMA200 1768.49
 
Levels
Previous Daily High 1885.05
Previous Daily Low 1860
Previous Weekly High 1931.54
Previous Weekly Low 1894.48
Previous Monthly High 1992.42
Previous Monthly Low 1848.82
Daily Fibonacci 38.2% 1869.57
Daily Fibonacci 61.8% 1875.48
Daily Pivot Point S1 1856.89
Daily Pivot Point S2 1845.92
Daily Pivot Point S3 1831.84
Daily Pivot Point R1 1881.94
Daily Pivot Point R2 1896.02
Daily Pivot Point R3 1906.99

 

 

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.

Recommended content


Recommended content

Editors’ Picks

GBP/USD resumes upside toward 1.3300 ahead of BoE rate call

GBP/USD resumes upside toward 1.3300 ahead of BoE rate call

The GBP/USD gains traction and approaches 1.3300 in European trading on Thursday, having found buyers near 1.3150. A broad US Dollar pullback and a rebound in risk sentiment offer support to the pair ahead of the BoE policy announcements. 

GBP/USD News
EUR/USD rises further toward 1.1200, focus shifts to ECB-speak

EUR/USD rises further toward 1.1200, focus shifts to ECB-speak

EUR/USD stays strongly bid toward 1.1200 in the European session on Thursday. The pair capitalizes on a renewed US Dollar retreat and an upbeat mood. Traders digest the Fed's dovish outlook, bracing for ECB-speak for fresh trading incentives. US data are also eyed. 

EUR/USD News
Gold hovers close to new high of $2,600 after Fed meeting

Gold hovers close to new high of $2,600 after Fed meeting

Gold (XAU/USD) edges higher and trades back in the $2,580s on Thursday after falling to the $2,540s following the US Federal Reserve (Fed) decision on interest rates the prior day.

Gold News
BoE expected to keep interest rate unchanged at 5% as price pressures persist

BoE expected to keep interest rate unchanged at 5% as price pressures persist

After a close call in August, the Bank of England’s September interest rate decision is keenly awaited for fresh cues on the bank’s future policy action and the pace of its bond sales.

Read more
Solana announces details of Seeker, second mobile device after Saga phone

Solana announces details of Seeker, second mobile device after Saga phone

Solana Lab’s second phone, Seeker, is set to launch in 2025. At Token2049, a global conference for crypto, Solana’s General Manager Emmett Hollyer said that the new mobile would be a “rewards magnet” for its users.

Read more
Moneta Markets review 2024: All you need to know

Moneta Markets review 2024: All you need to know

VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.

Read More

Forex MAJORS

Cryptocurrencies

Signatures