- Gold is running into a wall of resistance on the longer time frames.
- Bears will be looking for a correction to restest the prior resistance.
- Gold Price Analysis: XAU/USD to test $1,900 amid data disappointments – TDS
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Update: Gold price remains on the front foot near the four-month top, up 0.20% around $1,871, as European traders prepare for Tuesday’s bell. The gold buyers initially cheered a jump in the US Treasury yields to refresh multi-day high before recently respecting the downbeat US dollar. It should, however, be noted that the greenback bears await fresh clues and hence gold run-up stalls around the key resistance comprising late January tops. Behind the moves could be the mixed signals from the Fed and the US data, as well as the coronavirus (COVID-19) vaccine optimism. Additionally, cautious sentiment ahead of Wednesday’s FOMC might also probe gold bulls going forward.
Gold price is off the highs and slips below $1870 amid a bounce in the Treasury yields across the curve, which helps cap the US dollar’s decline. The gold price refreshed three-month highs at $1874 in the last hour, as the greenback continues to remain undermined by the expectations that the Fed will maintain interest rates lower for a longer period, especially after the weaker US Retail Sales report tamed concerns about rising inflation.
Further, gold received an additional boost after Dallas Fed President Robert Kaplan on Monday reiterated his view that he does not expect rates to rise until next year. Meanwhile, mounting growing covid cases in Asia and escalating Middle East tensions keep the buoyant intact around the traditional safe-haven gold.
Read: Gold is surging again, but can prices push above 1900? [Video]