Gold Price Analysis: XAU/USD consolidates above $1,800, risk-on favors bears near four-month low


  • Gold struggles to keep $1,800 threshold while taking rounds to four-month low.
  • Biden’s formal power shift, vaccine hopes enthuse market sentiment.
  • DJI30, S&P 500 closed at the record top, DXY eased.
  • Headlines from the US, concerning vaccine and other risk events remain as the key drivers.

Gold bears catch a breather around $1,807/08 amid the early Wednesday morning in Asia. The yellow metal dropped to the lowest since July 20 the previous day but refrained from breaking the $1,800 round-figure.

The hopes of the US stimulus and recovery from the coronavirus (COVID-19) keep the gold bears hopeful. Even so, the metal’s latest U-turn may have respected the cautious mood ahead of 200-day SMA amid oversold RSI conditions on the daily chart.

US President-elect Joe Biden started speaking, firstly for the Irish border and then US unity, after getting the right to receive the President’s Daily Brief, the collection of classified intelligence reports prepared for the president. This suggests that America may now have movements over the much-awaited COVID-19 stimulus before the expiry of the current spending bill on December 11. Also favoring the bulls were calls of ex-Fed Chair Janet Yellen’s role as the upcoming Treasury Secretary as well as downbeat US Consumer Confidence and Richmond Fed Manufacturing data.

Though the covid woes aren’t wiped out and the vaccine is still far from here, at least over two months, which in turn question the gold sellers near the key supports. Also probing the further downside is the Brexit risks and trade tussle between China and the West.

Against this backdrop, Wall Street benchmarks pleased the bulls whereas the US 10-year Treasury yields also rose back towards 0.90%.

While a lack of data/events may push the gold traders towards risk news, updates from the US and concerning the vaccine may get major attention.

Technical analysis

In addition to the key 200-day SMA level near $1,797/98, the mid-July bottom around $1,790 also adds a filter to the yellow metal’s downside. Meanwhile, gold buyers are less likely to take entries until prices stay below September’s low close to $1,848.50. Overall, oversold RSI conditions can push the bears to catch a breather around key supports mentioned above. Though, any further weakness past-$1,790 will not hesitate to recall May month’s top near $1,765.

Additional important levels

Overview
Today last price 1807.72
Today Daily Change -28.40
Today Daily Change % -1.55%
Today daily open 1836.12
 
Trends
Daily SMA20 1886.06
Daily SMA50 1897.46
Daily SMA100 1910.27
Daily SMA200 1795.22
 
Levels
Previous Daily High 1876.14
Previous Daily Low 1831.01
Previous Weekly High 1899.14
Previous Weekly Low 1852.8
Previous Monthly High 1933.3
Previous Monthly Low 1860
Daily Fibonacci 38.2% 1848.25
Daily Fibonacci 61.8% 1858.9
Daily Pivot Point S1 1819.37
Daily Pivot Point S2 1802.63
Daily Pivot Point S3 1774.24
Daily Pivot Point R1 1864.5
Daily Pivot Point R2 1892.89
Daily Pivot Point R3 1909.63

 

 

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