- Gold price stays defensive after reversing from 21-DMA.
- DXY picks up bids to reverse early Asian session losses amid mixed concerns.
- Yields stay downbeat in absence of Fedspeak, pre-data anxiety.
- XAU/USD may remain sidelined ahead of US CB Consumer Confidence, Q3 GDP.
Gold price (XAU/USD) remains directionless while bouncing off intraday low to $1,650 heading into Tuesday’s European session.
That said, the yellow metal lured buyers earlier in the day amid a softer US dollar but the greenback’s latest rebound appears to have weighed on the quote of late. It should be noted that the negative concerns surrounding China, one of the world’s biggest gold consumers, also challenge the precious metal prices of late.
US Dollar Index (DXY) picks up bids to regain the 112.00 threshold while paring the first weekly loss in three amid an absence of Fedspeak. It should be noted that the hawkish Fedspeak and downbeat US PMIs also underpin the DXY’s safe-haven demand.
China’s efforts to defend the struggling economy and global pessimism over Xi Jinping's third term, not to forget Hang Seng’s slump to a 13-year low, exert downside pressure on the market sentiment and the XAU/USD prices.
Amid these plays, the US 10-year Treasury yields remain pressured around 4.21%, down two basis points (bps) while the US stock futures and stocks in the Asia-Pacific region are mildly bid.
Moving on, second-tier US Housing data and Consumer Confidence figures may entertain gold traders ahead of Thursday’s US Gross Domestic Product for the third quarter (Q3).
Technical analysis
Gold retreats inside a two-week-old bearish megaphone. That said, the recent downside RSI and the quote’s pullback from the trend-widening pattern’s resistance line direct it toward the 100-EMA support near $1,645.
However, the metal’s further downside appears elusive as the yearly bottom near $1,614 and the lower line of the stated megaphone, close to $1,608, could challenge the XAU/USD bears afterward. Also acting as a downside filter is the $1,600 threshold, a break of which could direct the prices toward the April 2020 low near $1,572.
Meanwhile, the stated formation’s upper line and the 61.8% Fibonacci retracement of the metal’s upside from September 28 to October 04, around $1,658-60, appear a tough nut to crack for the gold buyers.
Overall, the bullion prices are likely to remain pressured but the south run could be a slower one.
Gold: Hourly chart
Trend: Further weakness expected
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD remains on the back foot below 1.0800
EUR/USD remains on the defensive below 1.0800, as it consolidates weekly gains heading into Friday’s European session. The pair takes cues from the market’s sluggish momentum amid a light calendar and repositioning ahead of next week’s top-tier EU/ US events.
GBP/USD keeps range around 1.2550 amid quiet markets
GBP/USD is keeping its range play intact at around 1.2550 in the European morning this Friday. The US Dollar is licking its wounds following the US jobs data-led steep sell-off. Markets stay cautious, anticipating the end-of-the-week flows and position adjustments.
Gold could recapture 21 DMA resistance if RSI turns bullish
Gold price is consolidating Thursday’s impressive rebound from near $1,940, having yo-yoed within a $30 weekly range. Gold price could see a range breakout on Friday should the end-of-the-week flows trigger intense volatility.
Binance.US to suspend USD deposits, citing aggressive and intimidating tactics by the SEC
BinanceUS, the American arm of Binance.com, has indicated plans to suspend USD deposits, noting that its banking partners would do the same for withdrawal beginning June 13.
Eurozone in recession, but why?
It appears that a technical recession has indeed materialized, although the statistical offices took some time to officially declare it. The slight decline of 0.1% in both the fourth and first quarters is rather minimal.