Gold price remains within striking distance of two-week high ahead of US macro data


  • Gold price regains some positive traction on Tuesday, albeit lacks follow-through buying.
  • Sliding US bond yields undermine the USD and lend some support to the XAU/USD.
  • Geopolitical risks further benefit the safe-haven metal, though the upside seems limited. 

Gold price (XAU/USD) catches fresh bids following the previous day's modest downfall and remains well within the striking distance of over a two-week high touched last Thursday. The US Dollar (USD) remains on the defensive in the wake of a fresh leg down in the US Treasury bond yields, which, in turn, is seen as a key factor acting as a tailwind for the commodity. Apart from this, persistent worries about geopolitical tensions in the Middle East further seem to benefit the precious metal's relative safe-haven status. 

Any meaningful appreciating move for the Gold price, however, seems limited on the back of hawkish Federal Reserve (Fed) expectations. The FOMC meeting minutes released last week, along with several Fed officials, suggested that the US central bank will keep rates higher for longer amid sticky inflation and a resilient economy. This should act as a tailwind for the US bond yields and the Greenback, which, in turn, might hold back traders from placing aggressive bullish bets around the non-yielding yellow metal.

Market participants now look to the US macro data – Durable Goods Orders, the Conference Board's Consumer Confidence Index and the Richmond Manufacturing Index – for short-term opportunities later this Tuesday. The focus, however, remains glued to the US Personal Consumption Expenditures (PCE) Price Index on Thursday, which might provide fresh cues about the Fed's rate-cut path and provide a fresh directional impetus to the Gold price. 

Daily Digest Market Movers: Gold price remains well supported by sliding US bond yields and softer USD

  • The yield on the benchmark 10-year US government bond remains depressed near 4.275%, undermining the US Dollar and lending some support to the Gold price.
  • A recession in Japan and the UK, along with continued geopolitical tensions stemming from conflicts in the Middle East, further benefit the safe-haven precious metal.
  • US President Joe Biden said on Monday that he hopes to have a ceasefire in the Israel-Hamas war and a pause-for-hostages deal by Ramadan's beginning on March 10.
  • The FOMC meeting minutes released last week and comments by several Federal Reserve officials suggested that the US central bank was in no rush to cut interest rates.
  • Kansas City Fed President Jeffrey Schmid said that the US central bank should be patient and wait for convincing evidence that the fight against inflation has been won.
  • Markets have all but priced out the possibility of a rate cut in March and see around a 60% chance of the first 25 basis points rate cut coming at the June FOMC meeting.
  • Traders now look to the US macro data due on Tuesday – Durable Goods Orders, the Conference Board's Consumer Confidence Index and the Richmond Manufacturing Index.
  • Investors this week will also confront the release of the Prelim US Q4 GDP print on Wednesday and the Personal Consumption Expenditures (PCE) Price Index on Thursday.
  • The latter is considered the Fed's preferred inflation gauge, which, in turn, will influence expectations about future rate cuts and provide fresh impetus to the XAU/USD.

Technical Analysis: Gold price needs to clear the $2,041-2,042 barrier for bulls to seize near-term control

From a technical perspective, any subsequent move up is likely to confront some resistance near the $2,041-2,042 area, or over a two-week high touched last Thursday. Some follow-through buying will confirm a break through the 50-day Simple Moving Average (SMA) barrier and pave the way for additional gains. Given that oscillators on the daily chart have just started gaining positive traction, the Gold price might then challenge the next relevant hurdle near the $2,065 supply zone. The momentum could extend further towards reclaiming the $2,100 round figure mark for the first time since early December 2023.

On the flip side, the overnight swing low, around the $2,025 region, might continue to protect the immediate downside ahead of the 100-day SMA, currently near the $2,009 area, and the $2,000 psychological mark. A convincing break below the latter will shift the near-term bias in favour of bearish traders and drag the Gold price to the $1,984 region en route to the very important 200-day SMA support near the $1,967-1,966 zone.

US Dollar price today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the weakest against the Japanese Yen.

  USD EUR GBP CAD AUD JPY NZD CHF
USD   0.00% 0.07% 0.05% 0.14% -0.05% 0.17% 0.00%
EUR 0.00%   0.07% 0.04% 0.14% -0.04% 0.15% -0.01%
GBP -0.06% -0.07%   -0.02% 0.08% -0.11% 0.09% -0.07%
CAD -0.04% -0.05% 0.00%   0.09% -0.10% 0.13% -0.05%
AUD -0.13% -0.14% -0.08% -0.11%   -0.19% 0.01% -0.15%
JPY 0.05% 0.05% 0.11% 0.09% 0.24%   0.20% 0.05%
NZD -0.17% -0.15% -0.11% -0.13% -0.02% -0.22%   -0.14%
CHF 0.00% 0.00% 0.07% 0.04% 0.14% -0.04% 0.15%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).

Gold FAQs

Why do people invest in Gold?

Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Who buys the most Gold?

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

How is Gold correlated with other assets?

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

What does the price of Gold depend on?

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

Share: Feed news

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


Recommended content

Editors’ Picks

EUR/USD clings to daily gains above 1.0650

EUR/USD clings to daily gains above 1.0650

EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.

EUR/USD News

GBP/USD recovers toward 1.2450 after UK Retail Sales data

GBP/USD recovers toward 1.2450 after UK Retail Sales data

GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.

GBP/USD News

Gold holds steady at around $2,380 following earlier spike

Gold holds steady at around $2,380 following earlier spike

Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.

Gold News

Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium

Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in

Bitcoin price shows no signs of directional bias while it holds above  $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research. 

Read more

Week ahead – US GDP and BoJ decision on top of next week’s agenda

Week ahead – US GDP and BoJ decision on top of next week’s agenda

US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.

Read more

Forex MAJORS

Cryptocurrencies

Signatures