Gold Price Forecast: XAU/USD oscillates above $1,800 amid USD rebound, ahead of US ISM PMI

Gold price is hovering above $1,800.00, downside looks likely as DXY rebounds.
Fed Powell is unable to deliver any guarantee on bringing the inflation rate down to 2%.
Investors are expecting an underperformance on the US ISM PMI front.

Sagar Dua FXStreet

Gold price (XAU/USD) is holding itself above the psychological support of $1,800.00. The precious metal is declining gradually and is expected to remain in the grip of bears as the US dollar index (DXY) has rebounded modestly. Considering the price action, the gold prices are expected to violate $1,800.00 and the bears will show their true colors.

Traders should understand the fact that the commentary from Federal Reserve (Fed) chair Jerome Powell in his speech at ECB’s annual Forum on Central Banking has underpinned the DXY for a prolonged period. Fed Powell mentioned that the Fed will focus on returning the inflation rate at 2% by deploying the quantitative measures but there is no guarantee of that. This indicates that investors should start admitting that higher rates are for a prolonged period now and the employment tenure of Fed chair Jerome Powell will be full of troubles and challenges.

In today’s session, the spotlight will remain on the US Institute of Supply Management (ISM) Purchase Managers Index (PMI) data. As per the preliminary estimates of 55 vs. 56.1 previously reported, an underperformance is expected by the market participants.

Gold technical analysis

On an hourly scale, the gold prices are on a verge of giving a downside break of Thursday’s low at $1802.79 which will activate the descending triangle formation and will drag the precious metal vertically lower. Declining 20- and 50-period Exponential Moving Averages (EMAs) at $1,809.23 and $1,814.00 respectively add to the downside filters. The Relative Strength Index (RSI) (14) has tumbled below 40.00, which signals a fresh bearish impulsive wave ahead.

Gold hourly chart

XAU/USD

Overview
Today last price	1804.47
Today Daily Change	-2.83
Today Daily Change %	-0.16
Today daily open	1807.3

Trends
Daily SMA20	1834.99
Daily SMA50	1849.89
Daily SMA100	1891.72
Daily SMA200	1845.12

Levels
Previous Daily High	1825.19
Previous Daily Low	1802.79
Previous Weekly High	1847.95
Previous Weekly Low	1816.99
Previous Monthly High	1879.26
Previous Monthly Low	1802.79
Daily Fibonacci 38.2%	1811.35
Daily Fibonacci 61.8%	1816.63
Daily Pivot Point S1	1798.33
Daily Pivot Point S2	1789.36
Daily Pivot Point S3	1775.93
Daily Pivot Point R1	1820.73
Daily Pivot Point R2	1834.16
Daily Pivot Point R3	1843.13

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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