#XAUUSD @ 1737.39 -imp levels: Gold Price holds lower ground after Friday’s over 1% steep sell-off.

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• Gold Price holds lower ground after Friday’s over 1% steep sell-off.
• Hawkish Fed’s Powell sparks US dollar upswing, as risk tone sours.
• XAU/USD challenges critical daily support line, more downside likely.

The pair currently trades last at 1737.39.

The previous day high was 1758.94 while the previous day low was 1734.2. The daily 38.2% Fib levels comes at 1743.65, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1749.49, expected to provide resistance.

Gold Price is licking its wounds while keeping its range below $1,740, as a fresh week kicks off on a defensive note. Markets reprice September rate hike expectations in the lead-up to the US Nonfarm Payrolls week, especially after Fed Chair Jerome Powell’s hawkish remarks at Friday’s Jackson Hole appearance.

Powell maintained that the Fed will continue with its tightening path until inflation is brought down substantially from a four-decade high. The Fed Chief also added that the September rate hike decision will be data-dependent.

The US dollar bulls the hawkish comments in their stride and staged an impressive comeback in American trading on Friday while Wall Street indices suffered heavy losses, as Powell doused speculation of policy easing in the months ahead to tackle economic slowdown.

The extension of risk-aversion combined with the dollar gains in Asia so far this Monday is keeping gold traders on the back foot, as they gear up for another critical week. The US will publish the critical ISM Manufacturing and Services PMIs ahead of Friday’s payrolls. Each incoming data will be closely examined for signals on the size of the next Fed rate hike.

China’s economic data will also hog the limelight, as it will have a significant impact on the market’s perception of risk sentiment, eventually affecting the dollar’s valuation.

Also read: Gold Price Forecast: XAU/USD closes the week above 50 DMA, what’s next?

Technically, gold price tumbled to challenge the critical rising trendline support, now at $1,735. Daily closing below the latter is needed to extend Friday’s sell-off towards the previous week’s low of $1,728.

Bears will revive the bets for a test of the $1,700 threshold in the upcoming sessions.

The 14-day Relative Strength Index (RSI) is holding flat but below the midline, backing the ongoing weakness in the yellow metal.

On the upside, any recovery attempts will need to beat Friday’s high of $1,759, around where the bearish 50-Daily Moving Average (DMA) lurks.

Technical Levels: Supports and Resistances

XAUUSD currently trading at 1737.8 at the time of writing. Pair opened at 1737.82 and is trading with a change of 0.02 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1769.4, 50 SMA 1765.76, 100 SMA @ 1820.16 and 200 SMA @ 1837.39.

The previous day high was 1758.94 while the previous day low was 1734.2. The daily 38.2% Fib levels comes at 1743.65, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1749.49, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1728.37, 1718.91, 1703.63
• Pivot resistance is noted at 1753.11, 1768.39, 1777.85

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