The global flight to safety continued driving gold prices higher for the third consecutive session, to its highest level since the US Presidential elections in November 2016.
Mounting geopolitical tension over N. Korea's new missile launch over the northern Japanese island rattled global financial markets on Tuesday and boosted the precious metal's safe-haven appeal.
Adding to this, persistent greenback selling bias, with the key US Dollar Index sinking to over 16-month lows further benefitted dollar-denominated commodities and collaborated to the yellow metal's up-move to 9-1/2 month highs.
• US Dollar depressed, 92.00 on sight
The momentum helped the commodity to build on overnight strength above a key technical level, $1300 psychological mark and reinforced that the new uptrend is more likely to get extended in the near-term.
The metal, however, trimmed some of its early strong gains and has retreated a bit to $1320 area, possibly led by some profit taking following the recent upsurge of over 3.5% from Thursday's low level of $1276.
Later during the NA session, the release of CB Consumer Confidence Index from the US would now be looked upon for some short-term trading opportunities.
• US: Consumer confidence set to decline modestly – Danske Bank
The major focus, however, would remain on the revised US GDP print and the keenly watched US monthly jobs data (NFP), which would influence Fed rate hike expectations and eventually determine the next leg of directional move for the non-yielding metal.
Technical levels to watch
A strong follow through buying interest beyond $1325 level is likely to assist the metal to retest Nov. 2016 swing highs resistance near $1337 ahead of $1342-43 resistance area.
On the flip side, any profit taking slide below $1315-14 area now seems to find support near the $1309-08 region, which if broken could extend the corrective slide back towards the $1300 handle.
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 stays below 1.1100, looks to post weekly losses
EUR/USD continues to trade in a narrow range below 1.1100 and remains on track to end the week in negative territory. Earlier in the day, monthly PCE inflation data from the US came in line with the market expectation, failing to trigger a reaction.
GBP/USD struggles to find a foothold, trades near 1.3150
GBP/USD stays on the back foot and trades in negative territory at around 1.3150 on Friday. The US Dollar holds its ground following the July PCE inflation data and doesn't allow the pair to stage a rebound heading into the weekend.
Gold retreats toward $2,500 ahead of the weekend
Gold stays under modest bearish pressure and declines toward $2,500 in the American session on Friday. The 10-year US Treasury bond yield edges higher toward 3.9% after US PCE inflation data, causing XAU/USD to stretch lower.
Week ahead – Investors brace for NFP amid Fed rate cut speculation
Here comes another NFP week, with investors eagerly awaiting the results as they try to discern the size and pace of the Fed’s forthcoming rate cuts. The weaker than expected July numbers triggered market turbulence, instilling fears about a potential recession in the US.
Easing Eurozone inflation to back an ECB rate cut in September Premium
Eurostat will publish the preliminary estimate of the August Eurozone Harmonized Index of Consumer Prices on Friday, and the anticipated outcome will back up the case for another European Central Bank interest rate cut when policymakers meet in September.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.