#XAUUSD @ 3.8732 Gold price has declined sharply after testing the $1,670.00 hurdle amid wild DXY. (Pivot Orderbook analysis)

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• Gold price has declined sharply after testing the $1,670.00 hurdle amid wild DXY.
• Market sentiment is extremely positive as S&P500 futures have extended their gains.
• The odds for a hawkish Fed policy have resurfaced firmly above 94%.

The pair currently trades last at 3.8732.

The previous day high was 1658.24 while the previous day low was 1617.35. The daily 38.2% Fib levels comes at 1642.62, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1632.97, expected to provide resistance.

Gold price (XAU/USD) has picked offers while attempting to cross the critical hurdle of $1,670.00 in the Tokyo session. The precious metal has sensed decent selling pressure as the US dollar index (DXY) has turned extremely volatile amid gossip over the Bank of Japan (BOJ)’s intervention in the FX markets to support the Japanese yen.

The US dollar index (DXY) has gyrated in a 111.47-112.27 range and is likely to remain volatile until clarity over BOJ’s intervention as Japan’s top currency diplomat Masato Kanda has denied commenting on revealing any intervention plans.

Meanwhile, S&P500 futures have extended their upside journey, following Friday’s positive sentiment in early Asia. Simultaneously, the returns on US government bonds have dented further despite a recovery in bets on hawkish Federal Reserve (Fed) policy. The 10-year US Treasury yields have dropped further to 4.21%. While, the probability for a 75 basis point (bps) rate hike by the Fed carries more than 94% on the CME FedWatch tool, at the press time.

Going forward, the US S&P PMI data will be of utmost importance. As per the market consensus, the Manufacturing PMI will decline to 51.2 vs. the prior release of 52.0 while the Services PMI will slash to 49.2 from 49.3 reported earlier.

On an hourly scale, the Gold price has witnessed a stellar buying interest after testing the demand zone placed in a $1,614.85-1,621.60 range. The precious metal has crossed the 50-and 200-Exponential Moving Averages (EMAs) at $1,637.50 and $1,660.00 respectively in no time.

It is worth noting that the 50-and 200-EMAs have not delivered a bull cross yet, which shows the strength of the gold bulls. Also, the Relative Strength Index (RSI) (14) has shifted into the bullish range of 60.00-80.00, which indicates more upside ahead.

Technical Levels: Supports and Resistances

XAUUSD currently trading at 1657.02 at the time of writing. Pair opened at 1657.35 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 @ 1665.97, 50 SMA 1696.19, 100 SMA @ 1739.67 and 200 SMA @ 1814.23.

The previous day high was 1658.24 while the previous day low was 1617.35. The daily 38.2% Fib levels comes at 1642.62, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1632.97, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1630.39, 1603.42, 1589.5
• Pivot resistance is noted at 1671.28, 1685.2, 1712.17

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