Gold takes advantage of USD weakness, advances to daily highs above $1285

US Dollar Index extends decline below the 98 mark.
Market sentiment remains neutral ahead of this week's key events.
Coming up: CB Consumer Confidence Index and pending home sales data from the U.S.

Eren Sengezer FXStreet

The XAU/USD pair dropped to $1280 area on Monday as rising US Treasury bond yields made it difficult for the safe-haven precious metal to find demand. However, with the greenback coming under a renewed pressure on Tuesday, the pair erased yesterday's losses and was last seen trading at $1284.90, adding 0.45% on a daily basis.

Ahead of this week's highly-anticipated FOMC meeting, the US Dollar Index continues to correct last week's impressive rally. While investors are waiting for the Conference Board's Consumer Confidence Index and pending home sales data, the index is losing 0.27% on the day at 97.60.

Previewing Wednesday's Fed event, TD Securities analysts argued that the dollar was unlikely to come under a significant selling pressure even if Chairman Powell sounds more dovish than expected as markets had already priced that "sense of dovishness."

Meanwhile, the 10-year T-bond yield today is posting small losses, pointing out to a neutral market sentiment that helps gold preserve its strength against the buck. In the second half of the day, investors will be paying close attention to Wall Street's performance as well.

Technical levels to consider

XAU/USD

Overview
Today last price	1284.9
Today Daily Change	5.79
Today Daily Change %	0.45
Today daily open	1279.11

Trends
Daily SMA20	1285.77
Daily SMA50	1299.81
Daily SMA100	1292.5
Daily SMA200	1251.97

Levels
Previous Daily High	1286.85
Previous Daily Low	1278.18
Previous Weekly High	1288.75
Previous Weekly Low	1265.6
Previous Monthly High	1327.8
Previous Monthly Low	1280.1
Daily Fibonacci 38.2%	1281.49
Daily Fibonacci 61.8%	1283.54
Daily Pivot Point S1	1275.91
Daily Pivot Point S2	1272.71
Daily Pivot Point S3	1267.24
Daily Pivot Point R1	1284.58
Daily Pivot Point R2	1290.05
Daily Pivot Point R3	1293.25

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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