#XAUUSD @ 1747.61 -imp levels: Gold catches some bids on Tuesday and recovers further from a multi-week low.

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• Gold catches some bids on Tuesday and recovers further from a multi-week low.
• A softer risk tone, along with a modest USD pullback, offers support to the metal.
• Hawkish Fed expectations, elevated US bond yields should cap any further gains.

The pair currently trades last at 1747.61.

The previous day high was 1749.2 while the previous day low was 1727.87. The daily 38.2% Fib levels comes at 1736.02, expected to provide support. Similarly, the daily 61.8% fib level is at 1741.05, expected to provide support.

Gold reverses an intraday dip to the $1,730 area and climbs to a fresh daily high during the early North American session. The XAU/USD, for now, seems to have snapped a six-day losing streak to a nearly four-week low and is currently placed around the $1,745 region, though any meaningful upside still seems elusive.

Macroeconomic headwinds stemming from China’s COVID-zero policy – imposing snap lockdowns after just a handful of cases – continue to fuel recession fears. This, in turn, tempers investors’ appetite for riskier assets, which is evident from a generally weaker tone around the equity markets and benefits the safe-haven metal. Apart from this, a modest US dollar pullback from a two-decade peak further seems to underpin the dollar-denominated gold.

The USD lost additional ground following the release of weaker-than-expected flash US PMI prints for August. That said, expectations for a more hawkish message from Fed Chair Jerome Powell at the Jackson Hole symposium on Friday favour the USD bulls. This, in turn, suggests that the path of least resistance for gold is to the downside. Even from a technical perspective, the emergence of fresh selling at higher levels validates the negative outlook.

Furthermore, firming expectations that the Fed would continue to tighten its monetary policy leads to an extended sell-off in the US fixed income market. This, in turn, lifts the yield on the benchmark 10-year US government bond to a nearly one-month high and could exert some downward pressure on the non-yielding yellow metal. Hence, any subsequent move up might still be seen as a selling opportunity and runs the risk of fizzling out rather quickly near the $1,754-$1,755 horizontal support breakpoint.

Gold seems poised to prolong its recent retracement slide from the $1,808 area, or over a one-month high touched earlier this August. The downward trajectory could drag spot prices towards the $1,710 intermediate support en route to the $1,700 round-figure mark.

Technical Levels: Supports and Resistances

XAUUSD currently trading at 1740.41 at the time of writing. Pair opened at 1736.4 and is trading with a change of 0.23 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1768.3, 50 SMA 1772.63, 100 SMA @ 1827.34 and 200 SMA @ 1839.62.

The previous day high was 1749.2 while the previous day low was 1727.87. The daily 38.2% Fib levels comes at 1736.02, expected to provide support. Similarly, the daily 61.8% fib level is at 1741.05, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1726.45, 1716.49, 1705.12
• Pivot resistance is noted at 1747.78, 1759.15, 1769.11

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