Gold Price Analysis: XAU/USD eyes deeper losses below $1700

Gold (XAU/USD) holds the lower ground below the $1700 level, as Fed Chair Jerome Powell’s dismissal of the bond market turmoil triggered a fresh sell-off in the Treasuries, which drove the yields higher. The downside appears more compelling for XAU/USD as traders await US Nonfarm Payrolls and stimulus news for fresh impulse, FXStreet’s Dhwani Mehta reports.

See – Gold Price Analysis: Rising real yields raise the prospect of a serious XAU/USD fall – Credit Suisse

Key quotes

“Heading into the critical US NFP release, gold looks vulnerable, as the dollar holds firmer in tandem with the yields. If the headline NFP figures disappoint, the risk-off action in the global equities could intensify, bolstering the haven demand for the greenback, which could cause more pain for gold. The US economy is expected to add 182K jobs in February vs. the previous +49K figure. Also, the updates on the US $1.9 trillion stimulus will be closely followed as its nears approval by the Senate.”

“A 4-hour candlestick closing below the key $1687 support is needed to confirm the downside break, paving way for a drop towards the June 2020 low of $1671.”

“Recapturing the $1700 level is critical to unleashing further recovery gains. The confluence of the bearish 21-simple moving average (SMA) and the falling wedge resistance at $1717 is likely to be a tough nut to crack for the XAU bulls.”