Gold Price Forecast: XAU/USD sellers are lurking – TDS

FXStreet Insights Team FXStreet

XAU/USD is keeping the corrective momentum intact, as it remains below the $1,800 mark. In the view of strategists at TD Securities, gold’s price action may be revealing substantial selling interest.

Chinese bid in gold is reversing at a fast clip

“Gold's failure to break north of a key threshold for substantial short covering from CTA trend followers amid a miss in the highly anticipated US inflation data may be pointing to significant selling interest.”

“Strong physical demand may have exacerbated the short covering rally sparked by Chair Powell's FOMC speech, but we see evidence that the Chinese bid in gold continues to unwind.”

“The bar for additional CTA purchases continues to rise – prices now need to break north of $1,830 to catalyze a buying program from trend followers.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD drops to daily lows near 1.1630

EUR/USD now loses some traction and slips back to the area of daily lows around 1.1630 on the back of a mild bounce in the US Dollar. Fresh US data, including the September PCE inflation numbers and the latest read on December consumer sentiment, didn’t really move the needle, so the pair is still on course to finish the week with a respectable gain.

GBP/USD trims gains, recedes toward 1.3320

GBP/USD is struggling to keep its daily advance, coming under fresh pressure and retreating to the 1.3320 zone following a mild bullish attempt in the Greenback. Even though US consumer sentiment surprised to the upside, the US Dollar isn’t getting much love, as traders are far more interested in what the Fed will say next week.

Gold makes a U-turn, back to $4,200

Gold is now losing the grip and receding to the key $4,200 region per troy ounce following some signs of life in the Greenback and a marked bounce in US Treasury yields across the board. The positive outlook for the precious metal, however, remains underpinned by steady bets for extra easing by the Fed.