- A combination of factors capped the commodity’s early uptick to the $1845 region.
- A goodish pickup in the USD demand exerted some downward pressure on the metal.
- The technical set-up favours bearish traders and supports prospects for further decline.
Gold seesawed between tepid gains/minor losses through the early European session and consolidated the overnight slide to over two-week lows.
The underlying bullish sentiment weighed on the safe-haven XAU/USD and kept a lid on the early uptick to the $1845 region. Apart from this, a modest uptick in the US Treasury bond yields prompted some selling around the non-yielding yellow metal.
This, along with resurgent US dollar demand, exerted some additional pressure on the dollar-denominated commodity. The USD stood tall following the release of better-than-expected ADP report on the US private-sector employment.
Meanwhile, the recent rejection slide from $1875-76 supply zone dragged the yellow metal below a short-term ascending trend-line support on Tuesday. This, in turn, might have already set the stage for a further near-term depreciating move.
The negative outlook is further reinforced by bearish technical indicators on hourly/daily charts. A subsequent slide below the overnight swing lows, around the $1830 region, will reaffirm the bearish bias and prompt some technical selling.
The XAU/USD might then accelerate the downfall towards intermediate support near the $1818-17 region. The downward momentum could further get extended and allow bears to aim back to challenge 2021 swing lows, around the $1800 round-figure mark.
On the flip side, attempted recovery might now confront stiff resistance near the $1853-54 horizontal zone. Any further positive move would now be seen as a selling opportunity and runs the risk of fizzling out near the $1870-75 congestion zone.
XAU/USD 4-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.