- Gold price sees a temporary reprieve at the start of the week.
- The US dollar comes under renewed seling pressure, despite weaker yields.
- XAU/USD remains vulnerable so long as it holds below 21 DMA at $1,679.
Gold price is back in the green zone at the start of the week, snapping Friday’s brief pullback from five-day highs of $1,675. The bright metal stood resilient so far this Monday, despite the initial rebound in the US dollar, as the renewed weakness in the Treasury yields helped. But the dollar came under fresh selling pressure and resumed the previous week’s correction amid a return of risk-on flows, as investors cheered reports of UK PM Liz Truss looking to ditch scrapping a 45% tax rate following crisis talks with Chancellor after brutal Tory backlash last week. The US S&P 500 futures rebounded as much as 0.50% on the above headlines while GBP/USD stormed through the 1.1250 barrier. Earlier in the Asian session, risk sentiment was sapped by weak Asian factory activity data, which accentuated global economic slowdown fears amidst an inevitable central banks’ tightening spree. Despite the two-way price movement in the dollar, the bullion maintained its bid tone while ranging from $1,670-$1660.
Also read: Gold, the Chart of the Week: XAU/USD bears could be about to move in for the kill
XAU/USD snapped a two-week downtrend and closed the week with substantial gains on Friday, as the dollar rally eased off throughout the week. Investors viewed the recent upsurge in the greenback as excessive and resorted to profit-taking ahead of the September US payrolls report. Although the bullion failed to sustain at multi-day peaks of $1,675 and pulled back sharply in intraday trading after the US Core PCE Price Index, the Federal Reserve's preferred gauge of inflation, rose to 4.9% YoY in August vs. 4.7% in July, beating forecasts of 4.7%. Surging inflation bolstered expectations of a 75 bps rate hike by the Fed in November.
Gold price technical outlook: Daily chart
After last week’s recovery rally, Gold price needs a daily close above the bearish 21-Daily Moving Average (DMA) at $1,679.
However, the $1,670 round number and Friday’s high of $1,675 will need clearance first.
The 14-day Relative Strength Index (RSI) is sidelined just below the 50.00 threshold, suggesting that bulls could face a uphil battle and eventually yield into the bearish pressures.
On the downside, the $1,660 level offers strong support to buyers, which if breached will accentuate the bearish pressures towards the September 29 low of $1,642.
All in all, risks remain skewed to the downside for the bright metal so long as it holds below the 21 DMA.
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
Gold moves to record highs past $3,340 Premium
Gold now gathers extra steam and advances beyond the $3,340 mark per troy ounce on Wednesday, hitting all-time highs amid ongoing worries over escalating US-China trade tensions, a weaker US Dollar and lack of news from Powell's speech.
Australian Dollar receives support from improved global risk mood, US Retail Sales eyed
The Australian Dollar extends its winning streak against the US Dollar for a sixth consecutive session on Wednesday, with the AUD/USD pair holding firm after the release of Australia’s Westpac Leading Index. The index’s six-month annualised growth rate eased to 0.6% in March from 0.9% in February.
EUR/USD remains in a consolidative range below 1.1400
EUR/USD navigates the latter part of Wednesday’s session with marked gains, although another test of the 1.1400 level remained elusive. The strong bounce in spot came on the back of a marked move lower in the US Dollar, which remained apathetic following the neutral stance from Chair Powell.
Bitcoin stabilizes around $83,000 as China opens trade talks with President Trump’s administration
Bitcoin price stabilizes around $83,500 on Wednesday after facing multiple rejections around the 200-day EMA. Bloomberg reports that China is open to trade talks with President Trump’s administration.
Future-proofing portfolios: A playbook for tariff and recession risks
It does seem like we will be talking tariffs for a while. And if tariffs stay — in some shape or form — even after negotiations, we’ll likely be talking about recession too. Higher input costs, persistent inflation, and tighter monetary policy are already weighing on global growth.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.