- Gold edged lower for the second consecutive session on Thursday and refreshed weekly lows.
- The ongoing USD recovery from two-year lows was seen as a key factor weighing on the metal.
- The prevalent risk-on mood, a pickup in the US bond yields further contributed to the downfall.
Gold refreshed weekly lows during the early European session, albeit lacked any strong follow-through selling and quickly recovered a bit thereafter.
The precious metal extended this week's retracement slide from the $1992 area, or near two-week tops and remained depressed for the second consecutive session on Thursday. The downtick was sponsored by a bid tone surrounding the US dollar and the upbeat market mood.
The USD rebound from two-year lows was tied in part to Tuesday's upbeat US ISM Manufacturing PMI, which jumped to a nearly two-year high in August. Even Wednesday's weaker-than-expected US ADP report failed to hinder the greenback's ongoing recovery momentum.
Sustained USD buying was seen as one of the key factors that weighed on the dollar-denominated commodity. Apart from this, the prevalent risk-on environment further dented the precious metal's safe-haven demand and contributed to the modest downtick.
Prospects of additional US fiscal stimulus and Thursday's upbeat Chinese Caixin Services PMI boosted investors' confidence. The risk-on flow was reinforced by a pickup in the US Treasury bond yields, which exerted some additional pressure on the non-yielding yellow metal.
However, the downside remains limited, at least for the time being, with bears still awaiting a sustained break below a multi-week-old ascending trend-line support. This makes it prudent to wait for some follow-through selling before positioning for any further weakness.
Market participants now look forward to the US economic docket, highlighting the release of ISM Non-Manufacturing PMI. The data might influence the USD price dynamics and produce some short-term trading opportunities later during the early North American session.
Technical levels to watch
|Today last price||1935.95|
|Today Daily Change||-6.21|
|Today Daily Change %||-0.32|
|Today daily open||1942.16|
|Previous Daily High||1973.34|
|Previous Daily Low||1932.73|
|Previous Weekly High||1976.79|
|Previous Weekly Low||1902.76|
|Previous Monthly High||2075.32|
|Previous Monthly Low||1863.24|
|Daily Fibonacci 38.2%||1948.24|
|Daily Fibonacci 61.8%||1957.83|
|Daily Pivot Point S1||1925.48|
|Daily Pivot Point S2||1908.8|
|Daily Pivot Point S3||1884.87|
|Daily Pivot Point R1||1966.09|
|Daily Pivot Point R2||1990.02|
|Daily Pivot Point R3||2006.7|
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