• Gold snaps five-day uptrend, retreats from 12-day top.
  • US dollar pares recent losses around monthly low as yields probe three-week-long south-run.
  • Covid, geopolitical headlines renew the US dollar’s safe-haven demand even as downbeat data test the greenback bulls.
  • FOMC Minutes, Durable Goods Orders and ECBSpeak are the key catalysts for near-term clear directions.

Gold Price (XAU/USD) prints the first daily loss in five as the quote drops to the intraday low of around $1,860 during Wednesday’s Asian session. The metal’s latest weakness could be linked to the US dollar’s rebound from a monthly low ahead of the key data/events.

That said, the US Dollar Index (DXY) rises 0.21% as it recovered from a four-week low eye to regain the 102.00 threshold. The DXY rebound could be linked to the risk-negative headlines from China and South Korea, as well as the market’s preparations for the US Durable Goods Orders for April, expected 0.6% versus 1.1% prior, as well as the Federal Open Market Committee (FOMC) Minutes.

North Korea’s firing of three missiles and Japan’s dislike for the same join the market’s anxiety ahead of today’s Fed Minutes and seem to also weigh on the market’s optimism. On the same line could be the news updating China’s covid lockdowns and their negative impacts on the world’s second-largest economy. “Beijing has continued its quarantine to end its month-old COVID outbreak, while in Shanghai, authorities plan to keep most restrictions in place this month, before a more complete lifting of the two-month-old lockdown from June 1,” said Bloomberg.

While portraying the mood, the S&P 500 Futures pare the early-day gains around 3,955, up 0.40% intraday, whereas the US 10-year Treasury yields stay defensive around one-month low, at 2.76% by the press time.

On Tuesday, downbeat prints of the US housing data and repeated Fedspeak, in contrast to the hawkish comments from the ECB, exerted downside pressure on the US Treasury yields and the US Dollar.

Looking forward, gold prices are likely to bear the burden of the US dollar rebound. However, any more bearish signals from the FOMC Minutes and/or downbeat US data will allow the precious metal to pare recent losses.

Technical analysis

Gold Price stays pressured inside a weekly bullish channel, recently tracking RSI (14) as it retreats.

Given the RSI pullback from the overbought territory, coupled with the failure to cross the 38.2% Fibonacci retracement (Fibo.) of the April 18 to May 16 downturn, XAU/USD is likely to decline further.

However, a convergence of the aforementioned channel’s support and the 100-SMA, around $1,848, appears a tough nut to crack for the gold sellers.

In a case where gold drops below $1,848, a south-run towards the $1,800 threshold will precede the bear’s intention to refresh the monthly low, around $1,787 by the press time, which can’t be ruled out.

On the contrary, the resistance line of the stated channel, at $1,878 by the press time, will test the XAU/USD bulls should they cross the 38.2% Fibo. near $1,867.

Even so, a confluence of the 200-SMA and 50% Fibonacci retracement level, close to $1,892, will challenge the metal’s further upside.

Gold: Four-hour chart

Trend: Further weakness expected

Additional important levels

Overview
Today last price 1860.83
Today Daily Change -5.74
Today Daily Change % -0.31%
Today daily open 1866.57
 
Trends
Daily SMA20 1854.7
Daily SMA50 1905.31
Daily SMA100 1885.45
Daily SMA200 1838.87
 
Levels
Previous Daily High 1869.75
Previous Daily Low 1849.44
Previous Weekly High 1849.45
Previous Weekly Low 1786.94
Previous Monthly High 1998.43
Previous Monthly Low 1872.24
Daily Fibonacci 38.2% 1861.99
Daily Fibonacci 61.8% 1857.2
Daily Pivot Point S1 1854.09
Daily Pivot Point S2 1841.61
Daily Pivot Point S3 1833.78
Daily Pivot Point R1 1874.4
Daily Pivot Point R2 1882.23
Daily Pivot Point R3 1894.71

 

 

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.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD rebounds, steadies above 1.0400

EUR/USD rebounds, steadies above 1.0400

EUR/USD has staged a rebound and reclaimed 1.0400 during the American trading hours on Friday with the US Dollar Index retreating from the multi-week high it set at above 105.60. Nevertheless, the pair remains on track to close the week in negative territory. 

EUR/USD News

GBP/USD climbs to 1.2050 area, looks to post weekly losses

GBP/USD climbs to 1.2050 area, looks to post weekly losses

GBP/USD reversed its direction and advanced to the 1.2050 area after having dropped to 1.1976 earlier in the day. The pair is still down more than 1% on the day with safe-haven flows dominating the financial markets following the disappointing PMI data from the US.

GBP/USD News

Gold rebounds above $1,800 as US yields fall sharply

Gold rebounds above $1,800 as US yields fall sharply

Gold has regained its traction and recovered above $1,800 after having slumped to a multi-month low below $1,790. Following the dismal PMI data from the US, the benchmark 10-year US Treasury bond yield is down more than 6% on the day, fueling XAU/USD's rebound.

Gold News

Why traders are rushing to exit positions on Cardano’s ADA price

Why traders are rushing to exit positions on Cardano’s ADA price

Cardano (ADA) price has had its performance review as the summer kicks off. ADA bulls are returning home with not-that-good a scorecard, and the underperformance could cut short holiday funding for the cryptocurrency.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures