Gold Price Analysis: XAU/USD wavers around $1,800 amid risk reset


  • Gold prices struggle for a firm direction around $1,800 threshold after snapping two-day losing streak the previous day.
  • Virus cases in the US ease a bit, American health officials cite early vaccine production.
  • Trump administration drops the idea of undermining Hong Kong dollar peg, discuss ending audit deal underpinning Chinese listings in the US.

Gold prices seesaw around $1,802, following its failure to extend the pullback from $1,800.62 beyond $1,804.26, amid the initial Asian session on Tuesday. While the bears are firming up the grip to defy Monday’s rejection of earlier declines since Thursday, bulls refrain from leaving unless $1,800 holds.

The latest headlines portray risk recovery amid the receding coronavirus (COVID-19) numbers from the US and mixed news concerning the Sino-American tension. While the CNBC relied on the top US health official to convey the early arrival of the pandemic’s cure, Bloomberg cited American diplomats dropping the idea of undermining the Hong Kong dollar peg to punish Beijing. However, US Secretary of State Mike Pompeo’s comments defying China’s claim over the South China Sea and Reuters update signaling further hardships for the listings of the Asian major’s equities on the US floor question the risk-on mood.

Other than the virus and the US-China tension, the UK’s ban on Huawei from British networks until 2027 and confrontations with new aircraft carriers also add worries into the global markets. On the contrary, increasing odds of further stimulus from the developed economies, including the US and the UK, underpin the risk-on moves.

Against this backdrop, S&P 500 Futures part ways from the downbeat Wall Street performance to print 0.21% gains around 3,155 by the press time. However, the US 10-year Treasury yields remain depressed around 0.62% as we write.

Moving on, China’s June month trade numbers will join the US Consumer Price Index (CPI) data for the previous month to decorate the economic calendar. However, major attention will be given to qualitative catalysts.

Technical analysis

FXStreet’s Rajan Dhall cites a short-term ascending trend channel formation to keep the bulls hopeful:

There is a clear channel formation but it is very steep. The first support will be the USD 1800 per troy ounce level but beyond that, the channel low could be next up. Any break of the channel low could take the price to the next support near USD 1787.13 per ounce. The MACD indicator is mixed as the signal lines are still above the midpoint but the histogram is in the red. The Relative Strength Index is just hanging at the 50 line and a dip below could be a bearish signal. The 50 line could be breached if the price breaks the consolidation low of USD 1794.58 per ounce. Longer-term the price is in a very strong uptrend. This retracement could just be a small blip as the price makes its way toward USD 2000 per troy ounce or the all-time high at USD 1920.94 per ounce.

Read: Gold Price Analysis: XAU/USD just dipped below $1800

Additional important levels

Overview
Today last price 1801.96
Today Daily Change 2.76
Today Daily Change % 0.15%
Today daily open 1799.2
 
Trends
Daily SMA20 1766.72
Daily SMA50 1737.9
Daily SMA100 1688.1
Daily SMA200 1600.95
 
Levels
Previous Daily High 1810.74
Previous Daily Low 1794.24
Previous Weekly High 1818.17
Previous Weekly Low 1770.16
Previous Monthly High 1785.91
Previous Monthly Low 1670.76
Daily Fibonacci 38.2% 1800.54
Daily Fibonacci 61.8% 1804.44
Daily Pivot Point S1 1792.05
Daily Pivot Point S2 1784.89
Daily Pivot Point S3 1775.55
Daily Pivot Point R1 1808.55
Daily Pivot Point R2 1817.89
Daily Pivot Point R3 1825.05

 

 

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