The price of gold, represented as XAUUSD and currently at 1,955.27, continues to decline from the previous day and approaches an important confluence point located at a range of $1,955-54. Nehcap’s perspective is that there is not much further for the price to drop.
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- Gold Price extends previous day’s retreat, prods key EMA confluence around $1,955-54.
The pair currently trades last at 1955.27.
The previous day high was 1967.96 while the previous day low was 1953.34. The daily 38.2% Fib levels comes at 1958.92, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1962.38, expected to provide resistance.
Gold Price (XAU/USD) suffers from the market’s pessimism about China, as well as the fresh hawkish concerns for the Federal Reserve (Fed), as it takes offers to renew its intraday low near $1,954 during early Monday in Europe.
That said, headlines surrounding multiple banks cutting China’s growth forecasts recently challenged the market’s risk appetite and weighed on the XAU/USD price. On the same line could be the hawkish comments from the Fed policymakers, as well as the latest report from the US central bank to Congress.
Richmond Fed President Thomas Barkin said, “Raising rates further could create the risk of a more significant slowdown in the economy.” The policymaker, however, also added that the Fed can do comfortable more to slow the resilient US economy, which in turn triggered a jump in the 2-year Treasury bond yields to 4.75% and helped the US Dollar to get off the lows. Not only Fed’s Barkin but Chicago Fed President Austan Goolsbee and Federal Reserve Governor Christopher Waller also appeared a bit hawkish and helped the DXY to reverse from a multi-day low the previous day.
Furthermore, the Fed’s Monetary Policy Report to the US Congress, published Friday stated, “Inflation in the US is well above target and the labor market remains very tight,” as per Reuters.
Alternatively, news from the South China Morning Post (SCMP) quoted China State Council to trigger the week-start optimism by suggesting more stimulus from the Asian major, which in turn puts a floor under the Gold Price. On the same line could be the receding fears of the US-China tussle as the key Diplomats from both nations are said to have held “candid and constructive talks” on their differences from Taiwan to trade, per Reuters.
Moving on, a light calendar and holiday in the US stocks, as well as bond, markets may restrict the Gold Price moves. Though, Fed Chairman Powell’s bi-annual testimony, as well as PMIs for June, will also be important to watch for clear directions.
Gold Price jostles with a convergence of the 50, 100 and 200 Exponential Moving Averages (EMAs), not to forget the 50% Fibonacci retracement of its June 02-15 downside, near $1,955-54.
In doing so, the XAU/USD extends the previous pullback from a fortnight-old descending resistance line, around $1,965 by the press time, amid bearish MACD signals.
That said, the RSI (14) line is below 50.0 and suggests bottom-picking in the Gold Price.
Hence, the XAU/USD buyers may remain hopeful unless witnessing a clear break of a two-week-long horizontal support zone surrounding $1,940-38, even if the bears conquer the $1,954 support confluence.
Meanwhile, an upside break of the aforementioned resistance line of near $1,965 can quickly direct the buyers toward the monthly high of around $1,983 before flagging the run-up toward the $2,000 psychological magnet.
Trend: Limited downside expected
Technical Levels: Supports and Resistances
XAUUSD currently trading at 1954.2 at the time of writing. Pair opened at 1957.98 and is trading with a change of -0.19% % .
| Overview | Overview.1 | |
|---|---|---|
| 0 | Today last price | 1954.2 |
| 1 | Today Daily Change | -3.78 |
| 2 | Today Daily Change % | -0.19% |
| 3 | Today daily open | 1957.98 |
The pair is trading below its 20 Daily moving average @ 1956.8, below its 50 Daily moving average @ 1985.33 , above its 100 Daily moving average @ 1942.08 and above its 200 Daily moving average @ 1847.63
| Trends | Trends.1 | |
|---|---|---|
| 0 | Daily SMA20 | 1956.80 |
| 1 | Daily SMA50 | 1985.33 |
| 2 | Daily SMA100 | 1942.08 |
| 3 | Daily SMA200 | 1847.63 |
The previous day high was 1967.96 while the previous day low was 1953.34. The daily 38.2% Fib levels comes at 1958.92, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1962.38, expected to provide resistance.
Note the levels of interest below:
- Pivot support is noted at 1951.56, 1945.14, 1936.94
- Pivot resistance is noted at 1966.18, 1974.38, 1980.8
| Levels | Levels.1 |
|---|---|
| Previous Daily High | 1967.96 |
| Previous Daily Low | 1953.34 |
| Previous Weekly High | 1971.01 |
| Previous Weekly Low | 1924.85 |
| Previous Monthly High | 2079.76 |
| Previous Monthly Low | 1932.12 |
| Daily Fibonacci 38.2% | 1958.92 |
| Daily Fibonacci 61.8% | 1962.38 |
| Daily Pivot Point S1 | 1951.56 |
| Daily Pivot Point S2 | 1945.14 |
| Daily Pivot Point S3 | 1936.94 |
| Daily Pivot Point R1 | 1966.18 |
| Daily Pivot Point R2 | 1974.38 |
| Daily Pivot Point R3 | 1980.80 |
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