The gold price has picked up bids below $1,735.00 and is expected to advance firmly. The precious metal oscillates in a wider range of $1,734.00-1,741.00 after a firmer rebound from Monday’s low at $1,720.40. Investors are supporting the yellow metal against the greenback as the US Institute of Supply Management (ISM) reports a disappointing performance on Thursday.

Gold fell on Tuesday as the dollar rose, while the likelihood of higher US interest rates for an extended period impacted on the non-yielding metal’s appeal. The US Federal Reserve and the European Central Bank set a hawkish tone at the Jackson Hole central banking conference in Wyoming, pledging all measures to contain stubbornly high inflation even if growth suffers.

While gold is considered a safe haven during economic instability, rising interest rates raise the potential cost of owning the metal. Markets are now pricing a 75-basis-point rate hike at the Federal Reserve’s September meeting.

On Monday, holdings in SPDR Gold Trust, the world’s biggest gold-backed exchange-traded fund, declined 0.4% to 980.61 tonnes, indicating investor sentiment. According to consensus, the US ISM Manufacturing PMI will be 52, down from the previous report of 52.8. Undoubtedly, the high street is concerned about declining commercial activity caused by a lack of cheap money for disposal.

As a result, a drop in manufacturing PMI projections is affecting investor mood. Aside from that, investors will be looking at new orders index data, which is predicted to rise to 48.5 from 48 previously reported. The data from the New Orders Index shows the demand for goods, and an improvement in economic data may help the DXY. The week’s highlight will be the US Nonfarm Payrolls (NFP) announcement on Friday.

Gold Technical Outlook

Gold price is struggling to confirm breaking the 1726.60 level, to trade positively, and retest the broken support of the bullish channel that appears on the chart, as it has remained stable below it until now, accompanied by clear negative signals from stochastic.

At the same time, the EMA 50 continues to exert negative pressure on the price. As a result, these factors encourage us to continue recommending a bearish trend for the upcoming period, with targets beginning with a break of 1726.60 to open the way to 1700.00, followed by 1680.00 levels.

In contrast, a break of 1740.00 will push the price to test 1755.70 directly before determining the next trend. Today’s trading range is expected to be between 1715.00 support and 1750.00 resistance.

Today’s projected trend is bearish.