- Gold Price continued losing ground for the second straight day and slipped below the $1,800 mark.
- Aggressive Fed rate hike bets, along with a blowout USD rally, exerted pressure on the commodity.
- The prevalent risk-off mood amid growing recession fears could offer support and limit the decline.
Gold Price drifted lower for the second successive day on Tuesday and weakened further below the $1,800 mark during the early North American session. The intraday decline was sponsored by a combination of factors, hawkish Fed expectations and a stronger US dollar, though the prevalent risk-off environment could help limit the downside.
Fed Chair Jerome Powell said last week that the US central bank remains focused on getting inflation under control and added that the US economy is well-positioned to handle tighter policy. This was seen as a key factor that continued acting as a headwind for the non-yielding yellow metal. Apart from this, a blowout USD rally to a fresh two-decade high further contributed to driving flows away from the dollar-denominated gold.
The greenback remained well supported by expectations for more aggressive Fed rate hikes and seemed rather unaffected by a steep decline in the US Treasury bond yields. Concerns about a potential economic recession forced investors to take refuge in traditional safe-haven assets and dragged the yield on the benchmark 10-year US government bond to a fresh multi-week low. This, in turn, could offer some support to gold.
Nevertheless, spot prices have now drifted back closer to the $1,786-$1,784 support zone, which if broken decisively would mark a fresh breakdown. That said, bearish traders might refrain from placing aggressive bets ahead of the FOMC meeting minutes, due on Wednesday. Apart from this, the release of the closely-watched US monthly jobs report (NFP) will influence the USD and determine the near-term trajectory of gold price.
Technical levels to watch
|Today last price||1789.32|
|Today Daily Change||-17.88|
|Today Daily Change %||-0.99|
|Today daily open||1807.2|
|Previous Daily High||1814.37|
|Previous Daily Low||1804.05|
|Previous Weekly High||1841.05|
|Previous Weekly Low||1784.55|
|Previous Monthly High||1879.26|
|Previous Monthly Low||1802.79|
|Daily Fibonacci 38.2%||1807.99|
|Daily Fibonacci 61.8%||1810.43|
|Daily Pivot Point S1||1802.71|
|Daily Pivot Point S2||1798.22|
|Daily Pivot Point S3||1792.39|
|Daily Pivot Point R1||1813.03|
|Daily Pivot Point R2||1818.86|
|Daily Pivot Point R3||1823.35|
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.