Gold Price Analysis: XAU/USD retraces biggest losses in seven years above $1,900


Share:
  • Gold prices carry bounce off $1,901.52, the lowest in two weeks.
  • US dollar gains, mixed sentiment triggered the bullion’s biggest daily slump since April 2013.
  • Risk catalysts to keep the driver’s seat ahead of the US CPI data.

Gold picks up the bids near $1,926.70 during the pre-Tokyo Asian session on Wednesday. The bullion dropped by around $120 the previous day, marking the biggest drop since late-April 2013, amid market’s rush to the US dollar. Though, the recent risk reset seems to have favored the pullback moves.

Consolidation or a trend change?

Although challenges to the US-China relations and uncertainty surrounding the American stimulus stay on the table, the market’s profit booking from gold’s magnanimous surge is less likely to defy the bulls unless any positive headlines.

Recently, Fox Business News (FBN) cited the US House Republican Leader Mitch McConnell to suggest no coronavirus (COVID-19) relief talks by the policymakers could be undertaken on Tuesday. On the other hand, the White House Adviser Larry Kudlow’s statement that China is fulfilling trade obligations can’t justify the Trump administration’s executive orders sanctioning officials from Beijing and the moves to term goods from Hong Kong as “Made in China”. It should also be noted US President Donald Trump also said that phase one deal with China means “very little” to him. Further, the Republican leader’s rhetoric to rekindle vaccine hopes also fails to convince the market optimists.

The reason could be traced from the fresh coronavirus (COVID-19) case in New Zealand and a sustained, but the recently slow, rise in the news cases in Australia and the US.

Against this backdrop, S&P 500 Futures follow Wall Street’s footsteps while declining to 3,333, down 0.07% on a day.

Looking forward, traders will keep eyes on the risk catalysts wherein the US stimulus talks and Sino-American news may join virus updates to occupy the front rows. Additionally, the US Consumer Price Index (CPI) for July, expected to rise from 0.6% to 0.8% on YoY, will also be the key to watch.

Technical analysis

An ascending trend line from March, at $1,867 now, restricts the yellow metal’s downside past-$1,900 nearby support. However, the bulls are less likely to regain controls unless the quote rises past-$2,000 mark.

Additional important levels

Overview
Today last price 1926.28
Today Daily Change -101.32
Today Daily Change % -5.00%
Today daily open 2027.6
 
Trends
Daily SMA20 1925.67
Daily SMA50 1821.7
Daily SMA100 1755.62
Daily SMA200 1645.46
 
Levels
Previous Daily High 2049.96
Previous Daily Low 2019.32
Previous Weekly High 2075.32
Previous Weekly Low 1960.67
Previous Monthly High 1984.8
Previous Monthly Low 1757.7
Daily Fibonacci 38.2% 2031.02
Daily Fibonacci 61.8% 2038.26
Daily Pivot Point S1 2014.63
Daily Pivot Point S2 2001.65
Daily Pivot Point S3 1983.99
Daily Pivot Point R1 2045.27
Daily Pivot Point R2 2062.93
Daily Pivot Point R3 2075.91

 

 

Share: Feed news

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.

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Editors’ Picks

EUR/USD extends decline toward 1.0500 after US data

EUR/USD extends decline toward 1.0500 after US data

EUR/USD came under renewed bearish pressure and declined toward 1.0500 in the second half of the day on Monday. After the data from the US showed that the ISM Manufacturing PMI came in better than expected in September, the US Dollar extended its rally and weighed on the pair.

EUR/USD News

GBP/USD falls below 1.2150 as USD rally continues

GBP/USD falls below 1.2150 as USD rally continues

GBP/USD turned south and retreated to a fresh daily low below 1.2150 in the American session. The US Dollar continued to gather strength against its rivals after the better-than-expected ISM September Manufacturing PMI data and forced the pair to stay on the back foot.

GBP/USD News

Gold falls to fresh multi-month lows near $1,830

Gold falls to fresh multi-month lows near $1,830

Gold price turned south and dropped to its weakest level since early March near $1,830. The benchmark 10-year US Treasury bond yield gained traction on upbeat US PMI data and was last seen rising nearly 2% on the day above 4.6%, causing XAU/USD to stretch lower.

Gold News

Week ahead: Fed speech and NFP likely to dictate crypto market moves this week

Week ahead: Fed speech and NFP likely to dictate crypto market moves this week

With the start of 2023’s fourth quarter, things are finally getting interesting in crypto. While the next 12 weeks are extremely important, let’s start by focusing on what to expect this week.

Read more

NIO contracts 2% as Tesla delivery decline weighs on EV sector

NIO contracts 2% as Tesla delivery decline weighs on EV sector

Nio (NIO) stock dropped 2.3% on Monday morning despite meeting its quarterly delivery target for the third quarter. Tesla's (TSLA) Q3 production and delivery decline is the culprit.

Read more

Forex MAJORS

Cryptocurrencies

Signatures