Gold Price Analysis: XAU/USD struggles to built on intraday bounce, flat-lined below $1845

Gold managed to recover intraday losses, albeit lacked any follow-through buying and was last seen trading in the neutral territory, just below the $1845 level.

The precious metal stalled its corrective pullback from over one-week tops set in the previous session and managed to attract some dip-buying near the 200-hour SMA, around the $1834-33 region on Thursday. The uptick was supported by a fresh leg down in the US Treasury bond yields, which tend to drive flows towards the non-yielding yellow metal.

Against the backdrop of Wednesday's weaker US consumer inflation figures, the US bond yields lost some additional ground in reaction to dovish comments by the Fed Chair Jerome Powell. Speaking to the Economic Club of New York, Powell indicated that the Fed isn't considering raising interest rates from the current near-zero levels.

The supporting factor, to a larger extent, was offset by the underlying bullish sentiment in the financial markets amid optimism over a strong global economic recovery. The progress in the rollout of vaccines for the highly contagious coronavirus and expectations for a massive US fiscal spending plan continued boosting investors' confidence.

This, in turn, held bulls from placing aggressive bets and kept a lid on any runaway rally for the safe-haven XAU/USD, at least for the time being. Hence, it will be prudent to wait for some strong follow-through buying before positioning for an extension of the recent bounce from two-month lows, around the $1785 region touched last week.

Market participants now look forward to the US economic docket, highlighting the release of the usual Initial Weekly Jobless Claims, due later during the early North American session. Apart from this, the US bond yields might influence the USD price dynamics and produce provide some impetus to the dollar-denominated commodity.

Technical levels to watch