Gold Price Analysis: XAU/USD extends the heaviest drop in three weeks below $1,800


  • Gold remains pressured after staging the notable downside.
  • S&P 500 Futures stretches losses from Treasury yield havoc.
  • US stimulus, PCE data will be the key but bond moves keep the driver’s seat.

Gold prices drop to $1,767, down 0.13% intraday, during Friday’s Asian session. In doing so, the yellow metal tracks the corrective pullback in S&P 500 Futures after the Treasury yields roiled global markets the previous day.

Markets pay a little heed to Fedspeak…

Although the Federal Reserve policymakers signaled that they are neither concerned nor should be about the jump in the Treasury yields, the same triggered market havoc and propelled the US dollar index (DXY) on Thursday. The US central bankers keep emphasizing their readiness to buy bonds but market players don’t listen and propel the coupons to the yearly top.

The resulted moves dragged equities amid the reflation fears while the US dollar’s recovery moves from a seven-week low weighed on the commodities and Antipodeans.

It should be noted that the vaccine optimism and upbeat prints of the US Q4 GDP, Durable Goods Orders and drop in weekly Jobless Claims were additional reasons for the US dollar’s recovery. Also on the positive side could be the hopes of President Joe Biden’s $1.9 trillion covid relief stimulus as the latest market chatters suggest the bill is to be voted in the Lower House today.

Against this backdrop, S&P 500 Futures drop 0.40% whereas the US 10-year Treasury yields rise 3.8 basis points to 1.55%.

Looking forward, gold traders will keep eye on the Treasury yields’ moves while also observing the US Core PCE data for January for fresh impulse. It should, however, be noted that the bears are likely to keep the reins until any major negatives renew gold’s safe-haven demand.

Technical analysis

Gold bears need a successful break below July 2020 low near $1,757 to extend the latest south-run. It should, however, be noted that the bulls are less likely to return until witnessing a daily close beyond a seven-week-old resistance line, currently near $1,805.

Additional important levels

Overview
Today last price 1770.06
Today Daily Change 0.36
Today Daily Change % 0.02%
Today daily open 1769.7
 
Trends
Daily SMA20 1813.05
Daily SMA50 1848.27
Daily SMA100 1860.21
Daily SMA200 1860.3
 
Levels
Previous Daily High 1805.86
Previous Daily Low 1765.56
Previous Weekly High 1827.11
Previous Weekly Low 1760.72
Previous Monthly High 1959.42
Previous Monthly Low 1802.8
Daily Fibonacci 38.2% 1780.95
Daily Fibonacci 61.8% 1790.47
Daily Pivot Point S1 1754.89
Daily Pivot Point S2 1740.07
Daily Pivot Point S3 1714.59
Daily Pivot Point R1 1795.19
Daily Pivot Point R2 1820.67
Daily Pivot Point R3 1835.49

 

 

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