Choppy Session Continues for Gold – Investor’s Eyes on $1,811 Resistance
Arslan Butt • 2 min read
Good morning, fellas,
The precious metal, GOLD, is trading with a neutral bias at the 1,805 level, facing immediate resistance at 1,811. During the Asian session, gold mainly traded with a bullish bias, on the back of slight weakness in the US dollar.
Gold traders seem hesitant as the market awaits the US Federal Reserve’s policy decision, which is due to be released by the Federal Open Market Committee (FOMC) at the end of the week.
Gold – Daily Trading Summary
On Monday, trading in the precious metal gold futures was bullish. It rose by 0.28% to $1,806.90 by 12:52 AM ET, somewhat over the psychological $1,800 per-ounce mark. The greenback, which usually moves in the opposite direction to gold, slipped lower on Monday morning, though it stayed near multi-month highs. However, it kept supporting the bullish bias in gold.
US Federal Reserve’s Policy Decision to Underpin Gold at $1,795
It is broadly anticipated that the FOMC will some changes to the Fed monetary policy when it appears tomorrow, with the arrangement to be passed down a day later. Investor focus will remain on the Federal Reserve, in the hopes that they will share some clues regarding interest rate and tapering decisions.
Besides this, the economic figures from the US, which were reported on Friday, showed that the manufacturing Purchasing Managers’ Index (PMI) came out positive at 63.1. The services PMI fell short of expectations, coming in at 59.8 for July.
The safe-haven appeal continues, as in Europe. Several nations have raised their defenses, due to rising numbers of cases of the Delta variant of COVID-19, while they struggle to raise their immunization rates.
Physical Demand for Gold Drops Amid Volatile Gold Prices
Speaking about the physical demand for gold in India, there was an inconsistent major gold hub throughout the past week. Volatility in gold prices discouraged buyers, driving merchants to offer discounts at the highest levels in nearly a month, to support purchases.
Gold – XAU/USD – Technical Outlook
On Monday, the precious metal, gold, is trading sideways above the 1,795 level, and it could bounce off until the next resistance level of 1,832. On the daily timeframe, the 50 EMA is extending resistance at 1,810 and 1,832. A bullish crossover at 1,832 could lead the gold price towards the 1,844 level.
Alternatively, violation of the 1,795 support level could extend the selling trend until levels of 1,776 and 1,753. The MACD and RSI are staying above and below the mid-levels, indicating indecision among investors. Let’s consider taking a buying position over 1,811 and selling below the same level today. Good luck!