Gold Price Analysis: XAU/USD climbs to fresh session tops, around $1,780 region
|- Gold regained positive traction on Monday and snapped two consecutive days of losing streak.
- Dovish Fed expectations capped the USD recovery and extended some support to the metal.
- The underlying bullish tone might keep a lid on any strong gains for the safe-haven XAU/USD.
Gold built on its steady intraday ascent and climbed to fresh daily tops, around the $1,780 region during the early European session.
The precious metal caught some fresh bids on the first day of a new trading week and recovered further from two-week lows, around the $1,756 region touched last Thursday. This marked the first day of a positive move in the previous three trading sessions and was supported by a combination of factors.
The US dollar struggled to capitalize on last week's goodish rebound from the lowest level since February 26 amid expectations that the Fed will keep interest rates low for a longer period. This, in turn, was seen as a key factor that extended some support to the dollar-denominated commodity.
Meanwhile, the upside is likely to remain capped amid the underlying bullish sentiment in the financial markets, which tends to undermine the safe-haven XAU/USD. Investors might also refrain from placing aggressive bets ahead of the Fed Chair Jerome Powell's scheduled speech later this Monday.
In the meantime, the release of the US ISM Manufacturing PMI might influence the USD price dynamics and provide some impetus to the XAU/USD during the early North American session. This makes it prudent to wait for some strong follow-through buying before positioning for any further appreciating move.
From a technical perspective, any subsequent strength is likely to confront stiff resistance near the 100-day SMA, around the $1,786 region. This is followed by the recent swing highs, around the $1,796-98 region, which if cleared decisively should set the stage for additional gains in the near term.
Technical levels to watch
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