Gold Price Analysis: XAU/USD to near the confluence support zone at $1,660-$1,670 – DBS Bank

FXStreet Team FXStreet

Rising US yields have exacerbated gold’s decline, with downward pressure having gold testing key Fibonacci markers at 1,726 and 1,689. The 19.2% decline from August 2020’s 2075 peak places the yellow metal at oversold levels, with XAU/USD driven towards a test of a 1,660-1,670 support confluence zone, Benjamin Wong, Strategist at DBS Bank, reports.

See – Gold Price Analysis: Weaker USD and range-bound real yields to underpin XAU/USD – Standard Chartered

Key quotes

“Gold ETF demand sprouted from September 2019 onwards, and back-testing that against an average line costing, such holdings are average costed around 1680 (hence the significance of the 1,660-1,670 confluence zone).”

“Both gold longs either on ETFs or futures positioning are reducing longs – hence, unless gold secures a sustained return over 1,760-1,765 (the May highs and a prior 50% Fibonacci marker) and the 200-day moving average at 1,859, the risks would be both ways until the bull reasserts its presence.”

Author

FXStreet Team

FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

AUD/USD rises to 0.6950 as USD slips on Fed's Warsh

AUD/USD regains traction and extends the bounce toward 0.6950 in the Asian session on Friday. Fed Chair Warsh's comments reinforce the selling pressure on the US Dollar, allowing the pair to stretch higher. Warsh said that he remains committed to delivering price stability without giving away anything on future interest rate path.

USD/JPY falls in symc with USD, gives up 158.00 after Warsh's speech

USD/JPY has come under fresh selling pressure and gives up 158.00 in the Asian session on Friday amid the emergence of fresh US Dollar selling. Fed Chair Warsh's non-committal commentary on the future tightening path, weighs on the US Dollar and the pair.

Gold looks vacillating above $4,150

Gold alternates gains with losses below the key $4,200 mark per troy ounce on Friday. The yellow metal’s irresolute price action comes in response to a modest pullback in the US Dollar and a tepid recovery in US Treasury yields across the board.

Bitcoin steadies at $82,000: The five forces crushing the Uptober rally

Crypto markets have remained under pressure so far in October, with Bitcoin (BTC) sliding below $80,000 earlier this week before recovering to around $82,000 on Friday, as macroeconomic headwinds and cooling demand weigh on the market.

The Fed just got a second hot inflation number. Here's what the diesel signal is really saying

The Federal Reserve (Fed) faces a renewed inflation challenge after two consecutive reports showed price pressure intensifying across the US economy. September's Consumer Price Index (CPI) confirmed accelerating consumer inflation, while the Producer Price Index (PPI) revealed an even sharper rise in business costs. Behind both reports lies a common factor: energy prices.

Everyone's dumping Gold after hot US inflation. Here's why $4,100 could be a floor, not a cliff

Gold (XAU/USD) is recovering from a sharp sell-off triggered by hotter-than-expected United States (US) inflation data released on Wednesday. The precious metal briefly plunged toward $4,073 as investors increased their bets on further Federal Reserve (Fed) interest rate hikes before recovering as US Treasury yields and the US Dollar (USD) reversed their initial gains.