Gold Price Analysis: XAU/USD looks to extend the bounce above $1990
- Gold bulls fighting back control amid cautious risk tone.
- Dollar drops with T-yields, makes yieldless gold attractive.
- FOMC July meeting’s minutes to offer fresh direction.
Having found support around $1985-80 region so far this Wednesday, gold (XAU/USD) is looking to extend its hold above the $1990 level, as the bulls remain unnerved ahead of the minutes of the US Federal Reserve’s last policy meeting.
The yellow metal, however, continues to draw support from the slump in the US Treasury yields, reflective of the uncertainty over the US fiscal stimulus, which could undercut the nascent economic recovery.
Further, the US-China tensions on the trade front, especially after US President Donald Trump said that he postponed last Saturday’s phase one trade deal review with China, underpins the haven demand for gold.
Looking ahead, the FOMC minutes will hold the key to determine a fresh direction for the metal. Markets will look for any clues on the yield curve control and the long-term economic projections for near-term trading opportunities.
Gold Technical levels
Gold is holding well above the key $1985 support, the previous month high. A break below which the next cushion at $1980, the convergence of the SMA200 one-hour and Fibonacci 61.8% one-week. Further south, the intersection of the previous day low and SMA50 four-hour at $1976 will offer some respite to the bulls. Acceptance above the latter will open doors for a test of $2000, where the Fibonacci 38.2% one-day and Bollinger Band 15-minutes Upper coincide.
Gold additional levels
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
