• The yellow metal got bolstered by an upbeat sentiment and a soft US dollar.
  • Gold’s recovery might be short-lived as US Treasury yields rise, a headwind for XAUUSD’s prices.
  • Gold Price Forecast (XAUUSD): Could uptick towards $1760 before continuing to the downside.

Gold (XAUUSD) spot bounces off the multi-month lows at around $1730s and grinds higher during the North American session as recession fears fade, and investors cheered China’s stimulus. At the time of writing, XAUUSD is trading at $1741.48 a troy ounce, slightly up 0.17%.

Positive sentiment and a soft greenback boosts gold's demand

Global equities are rallying, while the Fed’s last monetary policy minutes further cemented the case for a 75 bps rate hike in July, and the greenback recedes from 2-year highs, as shown by the US Dollar Index, back below the 107.000 figure. The yellow metal price jumped as relief, though any upward moves might be capped by rising US Treasury yields, with the US 10-year yield rising four bps, at 2.970%.

On Monday, rumors that the US might lift tariffs on China’s products remain as that. A Senior US Department of State said that no announcement is expected from Secretary Blinken at his meeting with China’s Foreign Minister Wang Yi. Earlier during the Asian session, according to Bloomberg, China was considering allowing local governments to sell $220 billion of special bonds in an infrastructure program, shifting sentiment positively, which weighed on the US dollar.

In the meantime, the US economic docket unveiled the Initial Jobless Claims for the week ending on July 2, which rose by 235K, higher than the 230K, and 4K more than the 231K in the previous week. The report shows some moderation in the tight labor market, as claims spiked the most since January. At the same time, the Balance of Trade showed the deficit contracted to -$85.5 billion, vs. -$86.7B in the previous month, courtesy of an uptick in Exports.

In the week ahead, the US calendar will feature Fed speakers, with Christopher Waller and St. Louis Fed President James Bullard. On Friday, the US Nonfarm Payrolls report, and the New York Fed President John Williams.

Gold Price Forecast (XAUUSD): Technical outlook

From the daily chart perspective, the XAUUSD bias is downwards. However, oscillators meandering around the oversold territory, with RSI at 27.27, might open the door for traders to book profits ahead into the weekend. If that scenario plays out, the XAUUSD’s first resistance would be December 15, 2021, low at $1752.35, followed by the July 5 daily low at $1763.82, before resuming to the downside.

XAU/USD

Overview
Today last price 1741.72
Today Daily Change 3.03
Today Daily Change % 0.17
Today daily open 1738.86
 
Trends
Daily SMA20 1821.18
Daily SMA50 1839.92
Daily SMA100 1888.8
Daily SMA200 1845.84
 
Levels
Previous Daily High 1772.97
Previous Daily Low 1732.27
Previous Weekly High 1841.05
Previous Weekly Low 1784.55
Previous Monthly High 1879.26
Previous Monthly Low 1802.79
Daily Fibonacci 38.2% 1747.82
Daily Fibonacci 61.8% 1757.42
Daily Pivot Point S1 1723.1
Daily Pivot Point S2 1707.33
Daily Pivot Point S3 1682.4
Daily Pivot Point R1 1763.8
Daily Pivot Point R2 1788.73
Daily Pivot Point R3 1804.5

 

 

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