Gold Price Analysis: XAU/USD holds steady around $1,780, lacks follow-through

Gold reversed an early European session dip to the $1,775 area and has now moved back to the top end of its daily trading range. The commodity was last seen hovering around the $1,781-82 region, up over 0.20% for the day.

The precious metal managed to regain some positive traction on the first day of a new trading week and for now, seems to have snapped two consecutive days of the losing streak. The uptick was exclusively sponsored by the prevalent bearish sentiment surrounding the US dollar, which tends to benefit the dollar-denominated commodity.

Investors now seem convinced that the Fed will keep interest rates near zero levels for a longer period. This was seen as a key factor that continued weighing on the greenback through the first half of the trading action. That said, a combination of factors might hold bulls from placing aggressive bets and cap gains for the XAU/USD.

A modest pickup in the US Treasury bond yields, for the time being, helped limit the USD downfall. This, in turn, should keep a lid on any runaway rally for the non-yielding yellow metal. Apart from this, the underlying bullish tone in the financial markets could further act as a headwind for the safe-haven XAU/USD.

Even from a technical perspective, the commodity has repeatedly failed near the $1,800 mark over the past three trading sessions. This makes it prudent to wait for some follow-through buying before positioning for an extension of the recent bounce from the $1,677-76 area, which constituted the formation of a double-bottom.

Market participants now look forward to the US economic docket, highlighting the release of Durable Goods Orders later during the early North American session. Apart from this, the US bond yields might influence the USD. Traders will further take cues from the broader market risk sentiment for some short-term opportunities around the XAU/USD.

Technical levels to watch