- Gold price has displayed a recovery move and has surpassed $1,910.00 amid weaker yields.
- The absence of demand in the S&P500 futures is restricting risk-perceived currencies in achieving solid upside bias.
- The US Dollar Index has failed to sustain above the critical resistance of 102.00
Gold price (XAU/USD) has rebounded firmly and has surpassed the immediate resistance of $1,910.00 in the early European session. The precious metal is gaining strength amid falling returns on US government bonds. The 10-year US Treasury yields has dropped firmly below 3.33% amid falling inflation projections.
Meanwhile, the risk profile is still negative as S&P500 futures are failing to find a cushion. The absence of demand in the S&P500 futures is restricting risk-perceived currencies in achieving solid upside bias. The US Dollar Index (DXY) has shifted its auction profile comfortably below the 102.00 resistance.
US yields are facing severe pressure as Federal Reserve (Fed) policymakers have started considering an interest rate hike by 25 basis points (bps) for February’s monetary policy meeting. Philadelphia Federal Reserve President Patrick Harker reiterated on Wednesday that he's ready for the US central bank to move to 25 basis points (bps) interest rate hike context amid some signs that hot inflation is cooling off. Also, the CME FedWatch tool displays more than 96% chances of hiking interest rates by bps to 4.50-4.75%.
Gold technical analysis
Gold price has rebounded firmly after testing the horizontal support plotted from January 12 high at $1,901.66 on an hourly scale. The downward-sloping trendline from January 16 high at $1,929.02 will continue to act as a major barricade for the Gold price.
The 100-period Exponential Moving Average (EMA) at $1,905.05 is acting as a major support for Gold price. Also, the Relative Strength Index (RSI) (14) has sensed support around 40.00, which indicates that the downside is restricted.
Gold hourly chart
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