Gold Price Analysis: XAU/USD tumbles to fresh lows sub-$1,900/oz

Gold prices rapidly lose momentum and breach $1,900/oz.
The greenback gathers further traction and hurt the metal.
US CPI figures fell in line with previous estimates in September.

Pablo Piovano FXStreet

Prices of the ounce troy of the precious metal lost further ground on Tuesday and challenge 3-day lows in the sub-$1,900 area on the back of the strong pick up in the demand for the greenback.

In fact, a bout of risk aversion benefits the greenback following the opening bell in Wall St. after House Speaker N.Pelosi said the recent proposal from President Trump on extra fiscal stimulus fell significantly short of expectations. Pelosi, however, expects both parties could clinch a deal eventually.

While the US Dollar Index (DXY) navigates in the area of 2-day highs around 93.50, the yellow metal tests 3-day lows near the $1,890 per ounce.

Earlier in the session, September’s US inflation figures measured by the CPI showed headline consumer prices rose 0.2% inter-month and 1.4% over the last twelve months. Furthermore, prices excluding food and energy costs rose 0.2% MoM and 1.7% from a year earlier. Extra data saw the NFIB Index at 104.0 in September and the IBD/TIPP Index is due later.

Gold key levels

As of writing Gold is losing 1.65% at $1,890.72 and faces the next support at $1,873.05 (monthly low Oct.7) seconded by $1,873.01 (50% Fibo of the June-August rally) and then $1,848.66 (monthly low Sep.24). On the other hand, a breakout of $1,933.28 (monthly high Oct.12) would expose $1992,63 (monthly high Sep1) and finally $2,015.65 (high Aug.18).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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