#XAUUSD @ 1699.15 Gold price is expecting more weakness after a decisive drop below $1,700.00. (Pivot Orderbook analysis)

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• Gold price is expecting more weakness after a decisive drop below $1,700.00.
• A higher-than-expected US CPI brutally slaughtered the gold prices.
• Going forward, the US Retail Sales and Michigan sentiment data will be of utmost importance.

The pair currently trades last at 1699.15.

The previous day high was 1731.87 while the previous day low was 1697.09. The daily 38.2% Fib levels comes at 1710.38, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1718.58, expected to provide resistance.

Gold price (XAU/USD) has given a downside break of the consolidation formed in a narrow range of $1,700.80-1,703.38 in the Asian session. The precious metal slipped below the psychological support of $1,700.00 and is expected to resume its downside momentum ahead. On Tuesday, the yell metal witnessed a vertical fall after failing to sustain above the critical hurdle of $1,730.00.

The gold prices witnessed a decent selling interest despite a higher-than-expected US inflation rate. The inflation-hedged asset nosedived after the headline Consumer Price Index (CPI) escalated to 8.3% against the forecast of 8.1% but landed lower than the prior release of 8.5%. While the US dollar index (DXY) displayed a juggernaut rally on rising expectations of a third consecutive 75 basis points (bps) rate hike by the Federal Reserve (Fed).

The DXY advanced to the psychological resistance of 110.00 on a significant increase in the core CPI that exclude food and oil prices. The catalyst increased significantly to 6.3% against the expectations of 6.1% and the prior release of 5.9%.

This week, the major trigger will be US Retail Sales data, which is showing no improvement in the overall demand. Also, the Michigan Consumer Sentiment Index will remain kin focus, which is seen higher at 60.0 vs. 58.2 recorded earlier.

On an hourly scale, gold prices witnessed a steep fall after a breakdown of the Ascending Triangle whose upward-sloping trendline is placed from the previous week’s low at $1,691.46 while the horizontal resistance is plotted from Thursday’s high at $1,728.24. The precious metal is now forming an Inverted Flag chart pattern n which the inventory distribution is followed by a sheer downside move.

The 20-period Exponential Moving Average (EMA) at $1,708.76 will remain a major hurdle for the counter.

Technical Levels: Supports and Resistances

XAUUSD currently trading at 1699.25 at the time of writing. Pair opened at 1702.18 and is trading with a change of -0.17 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1728.35, 50 SMA 1740.95, 100 SMA @ 1791.91 and 200 SMA @ 1832.87.

The previous day high was 1731.87 while the previous day low was 1697.09. The daily 38.2% Fib levels comes at 1710.38, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1718.58, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1688.89, 1675.6, 1654.11
• Pivot resistance is noted at 1723.67, 1745.16, 1758.45

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