Gold eases from multi-year tops, still well bid near $1380 level


  • Fed opened doors for a rate cut later this year and triggers some aggressive buying.
  • Tumbling US bond yields/prevalent USD bearish pressure remained supportive.
  • Bullish equities seemed to be the only factor capping gains amid overbought conditions.

Gold built on the post-FOMC upsurge and rallied to near six-year tops during the Asian session on Thursday, albeit retreated a bit thereafter.

The Fed on Wednesday left key interest rates unchanged but kept the door open for an interest rate cut by the end of this year. The US 10-year Treasury bond yield dropped below the 2.0% mark in reaction to dovish FOMC commentary and benefitted the non-yielding yellow metal.

Meanwhile, the latest leg of a free fall in the US Treasury bond yields triggered some aggressive US Dollar selling pressure and provided an additional boost to the dollar-denominated commodity and collaborated to the ongoing strong positive momentum to the highest level since September 2013.

Adding to this, possibilities of some aggressive stops being triggered on a sustained move beyond last week's swing high, around the $1358 region, further aggravated the move during the Asian session on Thursday and lifted the commodity closer to the key $1400 psychological mark.

However, the prevailing risk-on mood, as depicted by bullish trading sentiment across European bourses and indications of a strong opening in the US equity markets, weighed on the precious metal's relative safe-haven status and seemed to be the only factor capping gains. 

It would now be interesting to see if the commodity is able to attract some fresh dip-buying interest or traders opt to take some profits off the table amid near-term overbought conditions and renewed optimism over a possible resolution to the prolonged US-China trade disputes.

Technical levels to watch

XAU/USD

Overview
Today last price 1379.9
Today Daily Change 19.50
Today Daily Change % 1.43
Today daily open 1360.4
 
Trends
Daily SMA20 1319
Daily SMA50 1297.26
Daily SMA100 1302.6
Daily SMA200 1271.12
Levels
Previous Daily High 1362.5
Previous Daily Low 1341.56
Previous Weekly High 1358.2
Previous Weekly Low 1319.99
Previous Monthly High 1306.9
Previous Monthly Low 1266.35
Daily Fibonacci 38.2% 1354.5
Daily Fibonacci 61.8% 1349.56
Daily Pivot Point S1 1347.14
Daily Pivot Point S2 1333.87
Daily Pivot Point S3 1326.19
Daily Pivot Point R1 1368.08
Daily Pivot Point R2 1375.76
Daily Pivot Point R3 1389.03

 

 

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