- Gold once again manages to find some support near 100-day SMA, around the $1849 region.
- Some aggressive USD long-unwinding trade benefitted the dollar-denominated commodity.
- The risk-on mood, a strong pickup in the US bond yields might keep a lid on any further gains.
Gold reversed an early European session dip back closer to two-month tops and was last seen trading near the top end of its daily trading range, around the $1865-66 region.
The commodity once again managed to find decent support near 100-day SMA, around the $1849 region, and staged a modest rebound on the first day of a new trading week. The US dollar witnessed aggressive long-unwinding trade, which, in turn, was seen as a key factor that benefitted the dollar-denominated commodity.
Investors remain concerned that the lack of any additional fiscal stimulus measures could halt the current US economic recovery. Adding to this, the political uncertainty in the run-up to the US Presidential election further prompted traders to lighten their USD bullish bets and provided a minor lift to the XAU/USD.
Hence, the key focus will remain on the first presidential debate, scheduled on Tuesday. This, along with the release of the US economic data later this week, including the closely watched monthly jobs report (NFP), will provide a fresh directional impetus.
Meanwhile, the upside is likely to remain capped amid a strong recovery in the global risk sentiment. The risk-on mood was evident from solid gains in the equity markets, which could undermine the precious metal's safe-haven demand. The risk-on mood-led pickup in the US Treasury bond yields might further collaborate to keep a lid on any additional gains for the non-yielding yellow metal.
There isn't any major market-moving economic data due for release from the US on Monday. Hence, it will be prudent to wait for some strong follow-through buying before confirming that the XAU/USD might have already bottomed out in the near-term and positioning for any further near-term appreciating move.
Technical levels to watch
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
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.