• The ongoing USD sell-off continues to drive the commodity higher.
• Risk-on mood/pickup in the US bond yields seemed to cap gains.
Gold traded with a positive bias for the third consecutive session and touched a one-week high during the European session on Tuesday.
The precious metal extended its steady recovery from near 20-month lows and was further supported by the prevalent US Dollar selling bias, triggered by the US President Donald Trump's overnight comments.
Trump reiterated his displeasure over the Federal Reserve's monetary policy tightening and triggered a broad-based USD sell-off. Adding to this, optimism over the upcoming US-China trade talks was also cited as another headwind for the greenback and was eventually seen benefitting dollar-denominated commodities - like gold.
However, a goodish pickup in the US Treasury bond yields kept a lid on any runaway rally for the non-yielding yellow metal. This coupled with improving investors’ appetite for riskier assets, as depicted by positive tone around equity markets and which tends to undermine the precious metal's safe-haven demand, might further collaborate towards capping any meaningful up-move.
Moving ahead, this week's important release of the latest FOMC meeting minutes and the Fed Chair Jerome Powell's speech at the central bank symposium in Jackson Hole will now play a key role in determining the commodity's next leg of directional move.
Technical levels to watch
Immediate resistance is pegged near the $1200 handle, above which the commodity is likely to head towards testing the $1206 horizontal resistance. On the flip side, any meaningful retracement now seems to find some support near $1188 level and is closely followed by supports near the $1184 area and the $1180 region.
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 holds above 1.0700 ahead of key US data
EUR/USD trades in a tight range above 1.0700 in the early European session on Friday. The US Dollar struggles to gather strength ahead of key PCE Price Index data, the Fed's preferred gauge of inflation, and helps the pair hold its ground.
USD/JPY stays above 156.00 after BoJ Governor Ueda's comments
USD/JPY holds above 156.00 after surging above this level with the initial reaction to the Bank of Japan's decision to leave the policy settings unchanged. BoJ Governor said weak Yen was not impacting prices but added that they will watch FX developments closely.
Gold price oscillates in a range as the focus remains glued to the US PCE Price Index
Gold price struggles to attract any meaningful buyers amid the emergence of fresh USD buying. Bets that the Fed will keep rates higher for longer amid sticky inflation help revive the USD demand.
Sei Price Prediction: SEI is in the zone of interest after a 10% leap
Sei price has been in recovery mode for almost ten days now, following a fall of almost 65% beginning in mid-March. While the SEI bulls continue to show strength, the uptrend could prove premature as massive bearish sentiment hovers above the altcoin’s price.
US core PCE inflation set to signal firm price pressures as markets delay Federal Reserve rate cut bets
The core PCE Price Index, which excludes volatile food and energy prices, is seen as the more influential measure of inflation in terms of Fed positioning. The index is forecast to rise 0.3% on a monthly basis in March, matching February’s increase.