- September 9, 2022
- Posted by: Rohit Sharma
- Category: Uncategorized
- Gold price picks up bids to reverse the previous day’s pullback from weekly high.
- 100-SMA, 61.8% Fibonacci retracement and one-week-old resistance line stand tall to test XAU/USD buyers.
- US-China news, hopes from global central bankers trigger corrective moves and sluggish yields.
Gold price (XAU/USD) remains on the front foot around $1,720 amid early Friday morning in Europe. In doing so, the yellow metal cheers broad US dollar weakness amid cautious optimism in the market. Also favoring the bullion buyers are the technical signals.
US Dollar Index (DXY) pares the biggest daily loss in a month around 108.90, staying around the one-week bottom by the press time. In doing so, the greenback gauge fails to justify the hawkish comments from Fed Chair Jerome Powell, published the previous day, while highlighting the market’s firmer sentiment.
Market sentiment takes clues from firmer comments made late Thursday by US Treasury Secretary Janet Yellen, signaling a likely positive change in the US-China trade ties. Recently firmer US data and hopes that the global central bankers will be able to overcome inflation-led blow with a holistic approach and higher rates also seemed to have favored the market’s mood. It should be noted that talks over likely hardships for China’s technology company and downbeat China inflation numbers seemed to have probed the XAU/USD bulls of late.
While portraying the mood, the US 10-year Treasury yields remain sidelined near 3.32%, after a positive day, whereas the S&P 500 Futures traces Wall Street’s gains around 4,020. It should be noted that the stocks in the Asia-Pacific region also remain firmer as cautious optimism spreads amid a sluggish session.
Given the risk-on mood and downbeat US dollar, the XAU/USD prices are likely to end the week on a positive note. However, the last round of Fedspeak ahead of the blackout period, starting from this weekend, should be given attention for fresh impulse. Also important will be chatters surrounding the US inflation ahead of the next week’s US Consumer Price Index (CPI) data.
Given the bullish MACD signals, as well as the firmer RSI backing the higher low on prices, the XAU/USD is likely to overcome the $1,730 hurdle, which in turn could propel the commodity towards the August 25 swing high near $1,765.
However, the 50% Fibonacci retracement level near $1,745 may offer an intermediate halt during the run-up.
Alternatively, pullback moves may re-test the 78.6% Fibonacci retracement support, around $1,707, before directing gold bears towards the $1,700 threshold.
Even so, the sellers remain cautious as an upward sloping trend line from late July and the yearly low, respectively near $1,690 and $1,680, could test the metal’s further downside.
Gold: Four-hour chart
Trend: Further upside expected
ADDITIONAL IMPORTANT LEVELS
|Today last price||1721.51|
|Today Daily Change||13.06|
|Today Daily Change %||0.76%|
|Today daily open||1708.45|
|Previous Daily High||1728.27|
|Previous Daily Low||1704.01|
|Previous Weekly High||1745.58|
|Previous Weekly Low||1688.92|
|Previous Monthly High||1807.93|
|Previous Monthly Low||1709.68|
|Daily Fibonacci 38.2%||1713.28|
|Daily Fibonacci 61.8%||1719|
|Daily Pivot Point S1||1698.88|
|Daily Pivot Point S2||1689.32|
|Daily Pivot Point S3||1674.62|
|Daily Pivot Point R1||1723.14|
|Daily Pivot Point R2||1737.84|
|Daily Pivot Point R3||1747.4|