The price of gold, trading at $1,923.94 per ounce, continues to show strength at a two-week high. This is due to investors feeling optimistic but cautious, as they are encouraged by a weaker US Dollar.
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- Gold Price remains firmer around two-week high as bulls cheer softer US Dollar, cautious optimism.
Gold Price (XAU/USD) defends the previous weekly recovery, the first in five, as it rises for the second consecutive day amid the broad US Dollar weakness. Also adding strength to the XAU/USD rebound is the cautious optimism in the market, as well as the downbeat Treasury bond yields.
It’s worth noting that the US Dollar Index (DXY) cheers the Fed policymakers’ data dependency and recent mixed US data, as well as a sustained pullback in the US Treasury bond yields from the multi-year high marked last week.
Elsewhere, hopes of more stimulus from China via fiscal, as well as monetary policy, keep the Gold buyers hopeful.
However, the cautious mood ahead of the US inflation and employment clues, as well as China activity data, prod the XAU/USD bulls around the key $1,940 resistance confluence.
To sum up, the Gold Price has the majority of catalysts needed for the further upside but $1,940 and broad US Dollar weakness, as well as the downbeat yields, will decide the further advances of the XAU/USD.
Also read: Gold Price Forecast: Tide turns in favor of XAU/USD buyers, US jobs data awaited
As per our Technical Confluence indicator, the Gold Price floats within a $40 region multiple resistance area ahead of this week’s top-tier US inflation and employment clues.
That said, a convergence of the Pivot Point one-day R1 and the previous daily high guards the immediate recovery of the Gold Price near $1,928.
Following that, the 200-SMA on the four-hour (4H) chart and Fibonacci 61.8% on one-month, around $1,937, restricts further upside of the Gold Price.
In a case where the XAU/USD buyers keep the reins past $1,937, the Pivot Point one-week R2 around $1,945 will act as the last defense of the Gold sellers.
On the flip side, a convergence of the 5-DMA, previous daily low, Fibonacci 23.6% on one-week and Pivot Point one-day S1 together restrict the immediate Gold Price downside near $1,910.
Should the XAU/USD bears manage to conquer the $1,910 key support, the 10-DMA, previous monthly low and Fibonacci 161.8% on weekly chart, close to $1,900 at the latest, will act as the last check for the sellers.
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