Update: Gold price is feeling the pull of gravity, as it eases from daily highs after facing rejection once again at $1,790. The latest leg down in gold price can be associated with an uptick in the US Treasury yields, aided by the upbeat risk sentiment. Tame US inflation data released on Friday eased worries over aggressive Fed rate hikes, underpinning the non-interest-bearing gold.

From a broader perspective, gold price extends its sideways trading between $1,770-$1,795 seen last week. Markets stay focussed on the Fed policy decision for a fresh direction in the bright metal.

Read: Gold Price Forecast: XAU/USD’s path of least resistance appears down, Fed in focus – Confluence Detector

Gold (XAU/USD) stays directionless around $1,786, keeping the monthly sideways performance amid Monday’s Asian session.

The yellow metal benefited from the US inflation data the previous day but the market’s anxiety ahead of the key central bank meetings and the virus fears challenge the buyers of late. It should be noted, however, that the options market keeps the bearish bias over the commodity, as per the weekly risk reversals (RR).

The US Consumer Price Index (CPI) flashed a fresh 39-year high but matched market forecasts of 6.8% YoY for November. Also adding to the previous relief rally were the stable inflation expectations revealed via the University of Michigan Consumer Sentiment Index. That said, the RR, a gauge of calls to puts, marked a five-week downtrend with the latest figures of -0.1000.

Friday’s consolidation helped equities and weighed on the US Treasury yields, as well as the US Dollar Index (DXY). Though, markets turn cautious as the key week begins, comprising the monetary policy meeting of the US Federal Reserve (Fed).

Given the escalating fears of the Fed’s rush towards faster tapering and rate hikes, gold prices are likely to remain pressured. However, the US 10-year Treasury yields need to keep the recent rebound should the gold bears aim for further dominance.

Against this backdrop, the key US Treasury bond coupons take rounds to 1.49% whereas the S&P 500 Futures rise 0.20% by the press time.

In addition to Fed-linked woes, covid updates and the US-China tussles are also important to watch for clear direction amid a light calendar on Monday.

Technical analysis

Although a clear break of the previous support line from September 30 precedes the sustained trading below 100-SMA and 200-SMA, gold buyers lurk around a four-month-old ascending trend line.

Given the receding bearish bias of the MACD signals and mostly steady RSI, the bears are likely fading the strength. However, the stated DMAs around $1,790-95 and the support-turned-resistance line close to $1,800 will keep the bulls away.

Adding to the upside filter is the $1,815 level and tops marked in July, as well as September, surrounding $1,834.

On the contrary, a downside break of the multi-day-old support line, close to $1,769 at the latest, will need validation from the 61.8% Fibonacci retracement (Fibo.) of August-November upside surrounding $1,759 to convince the gold sellers.

To sum up, gold prices depict traders’ indecision as the key week begins.

Gold: Daily chart

Trend: Sideways

Additional important levels

Overview
Today last price 1783.28
Today Daily Change 0.46
Today Daily Change % 0.03
Today daily open 1782.82
 
Trends
Daily SMA20 1802.11
Daily SMA50 1795.76
Daily SMA100 1790.07
Daily SMA200 1793.06
 
Levels
Previous Daily High 1789.51
Previous Daily Low 1770.19
Previous Weekly High 1793.17
Previous Weekly Low 1770.19
Previous Monthly High 1877.23
Previous Monthly Low 1758.92
Daily Fibonacci 38.2% 1782.13
Daily Fibonacci 61.8% 1777.57
Daily Pivot Point S1 1772.17
Daily Pivot Point S2 1761.52
Daily Pivot Point S3 1752.85
Daily Pivot Point R1 1791.49
Daily Pivot Point R2 1800.16
Daily Pivot Point R3 1810.81

 

 

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 holds above 1.0700 after US inflation data

EUR/USD holds above 1.0700 after US inflation data

EUR/USD stays in the lower half of its daily range but continues to trade above 1.0700 in the early American session on Friday. The data from the US showed that the annual Core PCE Price Index declined to 4.9% in April as expected, making it difficult for the dollar to gather strength.

EUR/USD News

GBP/USD trades above 1.2600 as dollar struggles to find demand

GBP/USD trades above 1.2600 as dollar struggles to find demand

GBP/USD clings to daily gains above 1.2600 and remains on track to end the week in positive territory. The greenback struggles to attract investors after the data from the US showed that PCE inflation softened in April. 

GBP/USD News

Gold pulls away from daily highs, holds above $1,850

Gold pulls away from daily highs, holds above $1,850

Gold has lost its traction in the second half of the day on Friday and declined toward the $1,850 area. The benchmark 10-year US Treasury bond yield staged a modest rebound on the US PCE inflation data, not allowing XAU/USD to preserve its bullish momentum.

Gold News

Terra’s LUNA 2.0 support expands with Binance and Kraken welcoming the airdrop, here’s how you need to prepare

Terra’s LUNA 2.0 support expands with Binance and Kraken welcoming the airdrop, here’s how you need to prepare

Terra’s LUNA fork proposal has passed with 65.5% votes, Revival Plan 2 in action without algorithmic stablecoin UST. LUNA price could wipe out losses incurred by holders in the colossal crash of LUNC and UST. 

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