XAUUSD Current price: $1,843.37
- Fed’s Loretta Mester revived speculation of a potential 75 bps rate hike.
- US Treasury yields are sharply down amid renewed risk-aversion.
- XAUUSD gains bearish momentum after breaking the former May monthly low.
Spot gold started the day positively, advancing to an intraday high of $1,865.43 a troy ounce, as demand for the greenback remained subdued. The latter returned with Wall Street’s open, as US indexes quickly trimmed early gains, while XAU/USD fell to $1,841.38, its lowest since early February. The catalyst for the latest round of risk aversion came from US Federal Reserve Cleveland President Loretta Mester, who said that a 75 bps rate hike is not out of the table “forever,” although adding that the current pace of hikes seems “about right.”
Meanwhile, US government bond yields are sharply down amid renewed concerns about slowing economic progress. The yield on the benchmark 10-year Treasury note fell to 2.942%, holding nearby mid-American session. Investors’ focus is on the US Consumer Price Index, as the country will publish an update on inflation on Wednesday. The annual CPI growth is expected to slow down to 8.1% in April from a multi-decade high of 8.5% in the previous month.
Gold Prices short-term technical outlook
The daily chart for XAUUSD shows that it’s down for a second consecutive day, holding near the aforementioned low. Technical indicators turned lower near oversold readings, in line with another leg south. In the same chart, the bright metal has fallen further below its 20 and 100 SMAs, with the shorter accelerating south above the longer one. The 200 SMA provides dynamic support at around $1,835.60.
The 4-hour chart shows an increased bearish momentum, as technical indicators turned sharply lower within negative levels, now approaching oversold readings. At the same time, the 20 SMA accelerated slide above the current level and below the longer ones, reflecting strong selling interest. The former May monthly low at 1,850.35 is now the immediate resistance level.
Support levels: 1,835.60 1,825.40 1,813.70
Resistance levels: 1,850.35 1,862.10 1,873.00
View Live Chart for the XAU/USD
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD recovers from two-year lows, stays below 1.0450
EUR/USD recovers modestly and trades above 1.0400 after setting a two-year low below 1.0350 following the disappointing PMI data from Germany and the Eurozone on Friday. Market focus shifts to November PMI data releases from the US.
GBP/USD falls to six-month lows below 1.2550, eyes on US PMI
GBP/USD extends its losses for the third successive session and trades at a fresh fix-month low below 1.2550 on Friday. Disappointing PMI data from the UK weigh on Pound Sterling as investors await US PMI data releases.
Gold price refreshes two-week high, looks to build on momentum beyond $2,700 mark
Gold price hits a fresh two-week top during the first half of the European session on Friday, with bulls now looking to build on the momentum further beyond the $2,700 mark. This marks the fifth successive day of a positive move and is fueled by the global flight to safety amid persistent geopolitical tensions stemming from the intensifying Russia-Ukraine war.
S&P Global PMIs set to signal US economy continued to expand in November
The S&P Global preliminary PMIs for November are likely to show little variation from the October final readings. Markets are undecided on whether the Federal Reserve will lower the policy rate again in December.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.