Gold Price Analysis: XAU/USD sellers attack $1,730 as risk-off mood continues
- Gold prices consolidate after the initial downtick.
- Increasing risks of virus wave 2.0 confront upbeat comments from the Fed’s Kaplan.
- China’s data can offer immediate direction, Powell’s testimony will be the key during the week.
Gold seesaws around $1,731, intraday low of $1,728.04, during the initial Monday morning in Asia. The yellow metal recently weighed as weekend news keeps the risk of the coronavirus (COVID-19) outbreak 2.0 on the cards. In doing so, the bullion seems to ignore upbeat comments from the Dallas Federal Reserve President Robert Kaplan.
As per the latest update from the Tokyo Metropolitan Government the numbers of COVID-19 cases rose by 47, the highest since May 05. On the other hand, Beijing also reemployed the partial shutdown following the increase in the virus cases around the Xinfadi food market in the Southern Fengtai district. Elsewhere, Reuters spotted the record pikes in new virus cases, hospitalizations in the US.
It should also be noted that the protest in America and fears of few more sober statements from the Fed Chair Jerome Powell, during this upcoming testimonies, also weigh on the market’s trading sentiment. Even so, Fed’s Kaplan anticipates a recovery in the US job numbers from June while keeping previous pessimism surrounding the yearly unemployment rate.
Against this backdrop, S&P 500 Futures drop over 1.5% to 2,977 by the press time.
Traders might keep eyes on the Fed and the virus updates for fresh impulse. Further, China’s May month data dump, comprising Industrial Production and Retail Sales, will decorate the economic calendar and is worth observing as well.
Technical analysis
The buyers are likely stepping back from the monthly top surrounding $1,745/46. Even so, a 21-day SMA level near $1,723 seems to restrict the bullion’s immediate downside.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
