Gold Price Analysis: XAU/USD’s meteoric rally falters, closes the week below $2050

Dollar comeback poured cold water on gold’s record-breaking rally.
US-China woes, US stimulus deadlock and upbeat NFP boosted the USD.
The focus stays on US-China trade talks amid light US docket next week.

Dhwani Mehta FXStreet

Gold (XAU/USD) bulls remained in the charge the past week and went onto hit a strong of fresh all-time highs above the $2050 mark.

The spot, however, paused the surge and corrected sharply by 2% on Friday to settle the week below the latter. Despite the corrective pullback, the yellow metal booked a ninth straight weekly gain, the longest winning streak on a weekly basis.

The non-yielding gold extended its bullish momentum and clocked fresh life-time highs at $2075 last week, mainly driven by the record low US inflation-adjusted real Treasury yields. The lower Treasury yields indicated faltering US economic recovery and knocked-off the US dollar to fresh two-year lows across its main competitors.

Meanwhile, disappointing employment sub-indices of the ISM Manufacturing and Services PMIs combined with downbeat ADP jobs data pointed to slowing labor market recovery in the US amid coronavirus crisis, exacerbating the pain in the greenback.

Heading into Friday, the tide turned against the USD bears amid a resurgence of the safe-haven demand, as the US-China tech war escalated after US President Donald Trump signed orders banning the Chinese tech apps.

Collaborating with the dollar’s comeback was the report that the US is considering sanctions on the Hong Kong leader Carrie Lam, which accelerated the declines in gold. Also, US fiscal wrangling and above-forecasts US NFP data bolstered the dollar bulls.

In the week ahead, the spotlight will remain on the US-China trade talks, in the face of souring diplomatic ties and worsening virus situation worldwide. The light US calendar will keep the focus shifted towards the broader risk trends and dollar dynamics.

Gold: XAU/USD Key levels to watch

XAU/USD

Overview
Today last price	2035.16
Today Daily Change	0.00
Today Daily Change %	0.00
Today daily open	2035.16

Trends
Daily SMA20	1914.43
Daily SMA50	1815.93
Daily SMA100	1750.33
Daily SMA200	1642.89

Levels
Previous Daily High	2075.32
Previous Daily Low	2015.68
Previous Weekly High	2075.32
Previous Weekly Low	1960.67
Previous Monthly High	1984.8
Previous Monthly Low	1757.7
Daily Fibonacci 38.2%	2038.46
Daily Fibonacci 61.8%	2052.54
Daily Pivot Point S1	2008.79
Daily Pivot Point S2	1982.41
Daily Pivot Point S3	1949.15
Daily Pivot Point R1	2068.43
Daily Pivot Point R2	2101.69
Daily Pivot Point R3	2128.07

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

EUR/USD falls to near 1.1600 due to persistent bearish bias

EUR/USD depreciates after registering modest gains in the previous session, trading around 1.1610 during the Asian hours on Thursday. The technical analysis of the daily chart suggests a persistent bearish bias as the EUR/USD pair remains within the descending channel pattern.

GBP/USD underperforms as UK faces stagflation risks amid Middle East war

The Pound Sterling trades lower against its major currency peers, is down 0.22% around 1.3340 against the US Dollar, during the Asian trade on Thursday. The British currency faces selling pressures amid fears that the United Kingdom economy could face stagflation risks due to higher energy prices, a situation in which inflation accelerates with economic growth and employment conditions remaining stagnant.

Gold buyers stay hopeful amid Middle East war, China growth woes

Gold is building on the previous rebound in Thursday’s Asian trades, testing offers once again at the $5,200 threshold. Deeper escalation of the Middle East war and dovish US Federal Reserve monetary policy outlook continue to support Gold.

Top Crypto Gainers: Decred, Zcash, and Dogecoin lead recovery as Bitcoin crosses $72,000

Bitcoin trades above $72,500 at press time on Thursday, holding its 6% gain from the previous day, contributing to a broader market recovery. The total cryptocurrency market capitalization stands at over $2.43 trillion as the broader market sentiment improves significantly.

First Venezuela, now Iran: The US-China energy war escalates

At first glance, the latest escalation involving the United States with both Iran and Venezuela looks like another chapter in a long-running geopolitical story. But viewed through a broader strategic lens, something else may be unfolding: Energy.

Bittensor extends recovery despite retail demand slump

Bittensor, a leading Artificial Intelligence token, is aging up above $190 at the time of writing on Wednesday. Steady price increases characterise the broader crypto market, with Bitcoin holding above $71,000 and Ethereum above $2,000.