#XAUUSD @ 1712.04 Gold struggles to gain any meaningful traction and oscillates in a range on Monday. (Pivot Orderbook analysis)

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• Gold struggles to gain any meaningful traction and oscillates in a range on Monday.
• A modest USD pullback from a two-decade high offers some support to the metal.
• Expectations for aggressive tightening by major central banks might continue to cap.

The pair currently trades last at 1712.04.

The previous day high was 1718.02 while the previous day low was 1695.1. The daily 38.2% Fib levels comes at 1709.26, expected to provide support. Similarly, the daily 61.8% fib level is at 1703.86, expected to provide support.

Gold lacks any firm directional bias and seesaws between tepid gains/minor losses through the early North American session on Monday. The XAU/USD, so far, has managed to hold above the $1,700 round-figure mark and remains below Friday’s swing high touched in the aftermath of the mixed US monthly jobs report.

The US dollar trims a part of its intraday gains to a fresh two-decade high and offers some support to the dollar-denominated gold. A modest USD pullback could be solely attributed to some profit-taking amid slightly overbought conditions and relatively thin trading volumes on the back of the Labor Day holiday in the US. Apart from this, recession fears assist the safe-haven precious metal to attract some dip-buying near the $1,707 region.

That said, the prospects for a further policy tightening by major central banks to tame inflation act as a headwind for the non-yielding yellow metal. In fact, the Reserve Bank of Australia is anticipated to raise the cash rate at its meeting on Tuesday. Furthermore, the markets have been betting on a bumper rate hike by the European Central Bank on Thursday. The Bank of England is also expected to raise interest rates by at least 50 bps.

Adding to this, the markets have been pricing in a supersized 75 bps rate hike by the Federal Reserve at its upcoming policy meeting on September 20-21. This remains supportive of elevated US Treasury bond yields and favours the USD bulls. The fundamental backdrop should hold back traders from placing bullish bets around gold, warranting caution before positioning for an extension of last week’s bounce from the vicinity of the YTD low.

Technical Levels: Supports and Resistances

XAUUSD currently trading at 1711.71 at the time of writing. Pair opened at 1712.48 and is trading with a change of -0.04 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1755.27, 50 SMA 1754.28, 100 SMA @ 1807.79 and 200 SMA @ 1835.21.

The previous day high was 1718.02 while the previous day low was 1695.1. The daily 38.2% Fib levels comes at 1709.26, expected to provide support. Similarly, the daily 61.8% fib level is at 1703.86, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1699.05, 1685.61, 1676.13
• Pivot resistance is noted at 1721.97, 1731.45, 1744.89

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