Gold: Key $4500 support under scrutiny – Scotiabank

FXStreet Insights Team FXStreet

Scotiabank’s Global FX Strategy team observes renewed strength in non-energy commodities such as copper, while emphasizing that Gold remains anchored by the technically important $4500/oz level. They stress that this level has provided clear support so far, but warn that a downside break would imply a sizeable measured move lower based on their technical projections.

Technical focus on major support level

"Trading conditions are light and volumes are thin, reflecting today’s holidays in both the US and UK."

"The broader market’s tone is bullish and suggestive of risk appetite with US equity futures pushing to fresh highs as global benchmark oil prices trade down about $5/bbl on the day."

"The USD is soft and once again showing broad-based weakness against all of the G10 currencies as market participants signal renewed confidence in the prospect of a US/Iran deal."

"In terms of non-energy commodities we’re seeing renewed strength in the price of copper as it retraces its recent pullback from the record highs observed in mid-May."

"For gold, the technically relevant $4500/oz level has offered clear support, and we continue to watch for a break as the measured move target would suggest a ~$800/oz move (lower) from the level."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.