- Gold price lacks clear directions as sellers attack the key support amid mixed clues.
- XAU/USD traders remain confused as recession woes contrast with China losing Zero-Covid policy.
- Pre-Fed caution, downbeat US inflation expectations also act as trading filters.
- Risk catalysts could entertain Gold traders ahead of the busy days starting from Thursday.
Gold price (XAU/USD) treads water around $1,770 as bulls and bears jostle amid light calendar and mixed clues during early Wednesday.
The yellow metal’s struggle for clear directions recently got amplified as China’s trade surplus eased in November as the Imports and Exports both dropped during the stated month. On the same line is the gradual pick-up in the US Treasury yields amid fears of a global economic slowdown.
It’s worth noting that multiple top-notch company representatives and bank officials have recently raised fears of a global recession. On the same line were comments from Bloomberg Economics.
However, China’s readiness for announcing prudent fiscal and monetary policies, as well as hints of gradually removing the three-year-old Zero-Covid policy, seems to put a floor under the Gold price.
Amid these plays, US stock futures print mild gains but stocks in the Asia-Pacific zone trade mixed. That said, the US inflation expectations fail to defend the hawkish bets on the Fed’s next move during the pre-FOMC blackout.
Looking forward, China’s likely risk-positive announcements and second-tier data may entertain Gold traders ahead of Thursday’s China inflation numbers and Friday’s preliminary readings of the US Michigan Consumer Sentiment Index.
Gold price technical analysis
Not only a clear U-turn from the six-month-old horizontal resistance zone, around $1,805, but the sustained downside break of the 200-DMA, close to $1,794, also keeps the Gold sellers hopeful despite the sluggish MACD signals.
Also acting as a downside filter, as well as the immediate challenge for the XAU/USD bears, is an upward-sloping support line from November 08, close to $1,765.
In a case where the yellow metal remains bearish past $1,765, the previous week’s low surrounding $1,740 may lure the sellers before directing them to the tops marked in September and October, respectively near $1,735 and $1,730.
Alternatively, the 61.8% Fibonacci retracement level of the metal’s June-September downside and the 200-DMA, around $1,779 and $1,794 in that order, could test the Gold buyers before portraying another attempt to cross the $1,805 hurdle.
Overall, the Gold price remains bearish but a clear break of the $1,765 appears necessary for the sellers.
Gold price: Daily chart
Trend: Further downside expected
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.
Recommended content
Editors’ Picks
EUR/USD regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.