Gold Price Analysis: XAU/USD consolidates recent gains above $1,900

Gold bulls catch a breather around three-week high near $1,930 flashed on Friday.
Fresh challenges to US stimulus, Brexit and the coronavirus news probe the metal’s latest upside.
Off in the US, light calendar in Asia restrict market reaction.

Anil Panchal FXStreet

Gold takes rounds to $1,928/29, following the day-start weakness to $1,926.40, during the pre-Tokyo open Asian trading on Monday. The yellow metal rose to the highest since September 21 on Friday as the broad US dollar weakness, coupled with the risk-on mood, favored the buyers. However, the recent headlines concerning the American stimulus, Brexit and the coronavirus (COVID-19) question the bullion’s further upside. Even so, a lack of major catalysts and a long weekend at the US limit the downside momentum.

No takers for US Republican offer of $1.8 trillion stimulus…

On Friday, US President Donald Trump’s fresh bid for the coronavirus (COVID-19) stimulus, worth the $1.8 trillion, propelled global risk markets. The same dimmed the US dollar’s safe-haven demand and dragged the US dollar index (DXY) to the lowest in three weeks. The move helped commodities and Antipodeans the most.

However, the weekend headlines poured cold water on the face of optimists trying to extend gold’s latest run-up. Among them, US House Speaker Nancy Pelosi’s rejection of Trump’s offer and the COVID-19 fears from Europe has been the major negatives. Also in the line could be the Brexit updates suggesting no deal in sight despite reaching near to the October 15 deadline. It should be noted that the People’s Bank of China’s (PBOC) announcement of fresh measures to curb the yuan strength also couldn’t keep the gold bulls on the throne.

Amid these plays, S&P 500 Futures struggle for a clear direction near $3,470/75, near five-week high, whereas the other risk barometers like AUD/USD and AUD/JPY are also struggling for a clear direction by the time of the press.

Looking forward, gold buyers may find it difficult to extend the recent rally amid an absence of the US players and a light calendar. However, the yellow metal isn’t likely to fade its allure considering the current scenario.

Technical analysis

Having cleared a descending trend line from August 07, gold bulls need a clear break above the 50-day SMA, currently around $1,940. On the contrary, the metal’s fresh selling pressured below the immediate support line, previous resistance, near $1,911, can recall $1,900 on the chart.

Additional important levels

Overview
Today last price	1930.3
Today Daily Change	0.05
Today Daily Change %	0.00%
Today daily open	1930.25

Trends
Daily SMA20	1907.07
Daily SMA50	1939.5
Daily SMA100	1862.34
Daily SMA200	1744.38

Levels
Previous Daily High	1930.62
Previous Daily Low	1893.72
Previous Weekly High	1930.62
Previous Weekly Low	1873.01
Previous Monthly High	1992.42
Previous Monthly Low	1848.82
Daily Fibonacci 38.2%	1916.52
Daily Fibonacci 61.8%	1907.82
Daily Pivot Point S1	1905.77
Daily Pivot Point S2	1881.3
Daily Pivot Point S3	1868.87
Daily Pivot Point R1	1942.67
Daily Pivot Point R2	1955.1
Daily Pivot Point R3	1979.57

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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