|

Gold through 200-DMA barrier, hits fresh two-week highs

Gold started the week on an upbeat note and has now moved past the technically important 200-day SMA strong hurdle near $1,230 region. 

The precious metal built on last week's strong gains and jumped to fresh two-week tops during early NA session on Monday as the recent US data-disappointment has now raised skepticism that the Fed might not be able to stick to monetary policy normalization path. The ongoing slide in the US Treasury bond yields is supportive of the market speculations and is eventually benefitting the non-yielding yellow metal.

   •  Fed: Markets doubt about commitment to raise interest rates - BBH

Adding to this, the prevalent cautious environment was also seen driving flows towards traditional safe-haven assets and further collaborated to the metal's up-move to the highest level since July 3. 

Meanwhile, a modest US Dollar uptick, which tends to weigh on dollar-denominated commodities, did little to stall the ongoing up-move, albeit seems to be contributing towards capping further up-move, at least for the time being.

In absence of any major market moving economic releases, broader market risk sentiment and the US bond yield dynamics would continue to act as key determinants of the metal's movement through the NY trading session on Monday.

Technical levels to watch

Momentum above $1236 level could get extended towards $1242 horizontal resistance en-route 100-day SMA hurdle near the $1247 region. On the downside, 200-day SMA near $1230 area now becomes immediate support, which if broken could accelerate the slide towards $1226 horizontal level ahead of the $1220 important support.
 

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

More from Haresh Menghani
Share:

Editor's Picks

EUR/USD recedes to daily lows near 1.1850

EUR/USD keeps its bearish momentum well in place, slipping back to the area of 1.1850 to hit daily lows on Monday. The pair’s continuation of the leg lower comes amid decent gains in the US Dollar in a context of scarce volatility and thin trade conditions due to the inactivity in the US markets.

GBP/USD resumes the downtrend, back to the low-1.3600s

GBP/USD rapidly leaves behind Friday’s decent advance, refocusing on the downside and retreating to the 1.3630 region at the beginning of the week. In the meantime, the British Pound is expected to remain under the microscope ahead of the release of the key UK labour market report on Tuesday.

Gold looks inconclusive around $5,000

Gold partially fades Friday’s strong recovery, orbiting around the key $5,000 region per troy ounce in a context of humble gains in the Greenback on Monday. Additing to the vacillating mood, trade conditions remain thin amid the observance of the Presidents Day holiday in the US.

Bitcoin consolidates as on-chain data show mixed signals

Bitcoin price has consolidated between $65,700 and $72,000 over the past nine days, with no clear directional bias. US-listed spot ETFs recorded a $359.91 million weekly outflow, marking the fourth consecutive week of withdrawals.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

XRP steadies in narrow range as fund inflows, futures interest rise

Ripple is trading in a narrow range between $1.45 (immediate support) and $1.50 (resistance) at the time of writing on Monday. The remittance token extended its recovery last week, peaking at $1.67 on Sunday from the weekly open at $1.43.