- Gold built on its recovery from two-month lows and gained traction for the third straight day.
- Neutral technical indicators on the daily chart warrant caution for aggressive bullish traders.
Gold gained strong follow-through traction for the third consecutive session on Tuesday and climbed to one-week tops, around the $1848-49 region.
The emergence of some fresh selling around the US dollar was seen as a key factor that benefitted the dollar-denominated commodity. The greenback was further pressured by a pullback in the US Treasury bond yields, which drove some additional flows towards the non-yielding yellow metal.
From a technical perspective, a sustained move back above 200-hour SMA was seen as a key trigger for bullish traders and driving the XAU/USD higher. That said, the positive momentum stalled just ahead of a resistance marked by the 38.2% Fibonacci level of the $1960-$1785 recent downfall.
The mentioned barrier is pegged near the $1853-54 region, which if cleared decisively will set the stage for a further near-term appreciating move. The XAU/USD might then accelerate the positive move and challenge the $1875-76 supply zone, which coincides with the 50% Fibo. level.
The later should act as a key pivotal point for short-term traders and help determine the commodity's next leg of a directional move. A sustained move beyond should pave the way for additional gains and assist the XAU/USD to move back towards reclaiming the $1900 round-figure mark.
Meanwhile, technical indicators on the daily chart – though have been recovering from the positive territory – are yet to confirm a bullish bias. This, in turn, warrants some caution before positioning for any further appreciating move amid optimism over a strong economic recovery.
On the flip side, immediate support is pegged near the $1833-32 horizontal zone and is closely followed by the 23.6% Fibo. level, around the $1828 region. Failure to defend the mentioned support levels will negate any near-term positive bias and turn the XAU/USD vulnerable.
XAU/USD 1-hourly chart
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.