Gold Price Analysis: XAU/USD supported above key $1830 area but 200 and 50 DMAs blocking further gains

Spot gold prices look likely to squeeze between a short-term uptrend support and resistance in the $1850s.
A break above the 200 and 50DMAs in the $1850s could open the door to a move towards late-January highs at $1875.

Joel Frank Independent Analyst

Spot gold prices were choppy on Wednesday, swinging between a roughly $20 range between the $1835 and $1855 levels, but still managed to close Wednesday’s session with gains of around 0.3%.

Looking at the spot price over a short time horizon, XAU/USD has respected an uptrend from the Monday Asia Pacific session open low at just under $1830. Meanwhile, XAU/USD’s 200-day moving average (DMA) at $1854 provided tough resistance on Wednesday, implying that so long as the precious metal continues to respect this week’s uptrend support and 200DMA resistance, prices should continue to squeeze in the hours/days ahead, forming an ascending triangle that would theoretically be subject to a break out to the upside.

Breaking above Wednesday’s high/the 200DMA will be tough as, as spot prices will also need to surpass the 50DMA at $1857. But should the bulls succeed, XAU/USD would then be in with a shot of rallying back towards its late-January highs of around $1875.

Conversely, failure to break above this tough area of resistance in the $1850s and a subsequent break below the uptrend that has offered support to the price action thus far this week would open the door to a test of support in the $1830-$1835 area (the 20 and 27 January and 2 February lows). A break below this level could open the door to a collapse back down towards this month’s low in the $1780s, ahead of lows set last November in the $1760s.

XAU/USD four hour chart

Author

Joel Frank

Independent Analyst

Joel Frank is an economics graduate from the University of Birmingham and has worked as a full-time financial market analyst since 2018, specialising in the coverage of how developments in the global economy impact financial asset

USD/JPY eyes August swing low, near 155.20 ahead of US NFP

USD/JPY retests the August monthly swing low during the Asian session on Friday as a more hawkish repricing of BoJ rate-hike bets and a suspected intervention continue to underpin the Japanese Yen. Meanwhile, the US Dollar is seen consolidating the previous day's heavy losses amid soft US bond yields, further weighing on the currency pair as traders keenly await the US NFP report.

AUD/USD consolidates above 0.7200; US NFP awaited

AUD/USD holds steady above 0.7200, near its highest level since mid-May, as bulls await the US NFP report for more cues on the Fed's policy path before placing fresh bets. Meanwhile, the recent decline in US bond yields keeps the US Dollar depressed near its lowest level in over a week and acts as a tailwind for the Aussie amid the RBA's hawkish tilt.

Gold tumbles as blockbuster US NFP lift US Dollar, Treasury yields

Gold (XAU/USD) falls sharply on Friday, snapping a two-day recovery after the US Nonfarm Payrolls (NFP) report surprised strongly to the upside. The metal briefly climbed above $4,500 on Thursday, gaining nearly 2%, but has since erased a large part of that advance.

Crypto’s $638 million buyback boom may not be as bullish as it looks

Decentralized Finance (DeFi) protocols reportedly spent $638 million to buy back their native tokens in August, up 17% from a year earlier. On the surface, the buyback trend suggests the cryptocurrency industry is maturing fast, adopting one of Wall Street’s oldest tools to bolster valuations and distribute revenue. The headline becomes less impressive once the number is opened up.

Why hawkish Bank of Japan expectations aren't enough to sustain the Japanese Yen rally

The Japanese Yen (JPY) experienced a sudden burst higher after falling back below the 160.00 psychological mark against the US Dollar (USD) earlier this week amid a more hawkish repricing of Bank of Japan (BoJ) rate hike expectations.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.