Gold’s Price Dynamics Amid Risk Sentiments and Upcoming Fed Directions

Arslan Butt•Tuesday, October 17, 2023•2 min read

Gold‘s pricing trajectory, XAU/USD, encounters resistance in leveraging the earlier rebound from the $1,908 zone, facing renewed selling pressure during Tuesday’s Asian session. For the second consecutive day, GOLD prices retracted, influenced by an optimistic risk environment that typically diminishes the allure of conventional safe-haven assets. Moreover, heightened US Treasury yields, fueled by the anticipations of the Federal Reserve’s further policy adjustments, also exert downward pressure on the non-yielding metal.

However, the ongoing Israel-Hamas unrest could provide tailwinds for gold. Coupled with increasing consensus that the Federal Reserve might maintain interest rates in November, this could buffer the XAU/USD. The dovish tilt in the Fed’s anticipated stance keeps the US Dollar restrained, potentially curbing losses for the dollar-pegged metal. Market participants might adopt a cautious stance, awaiting Federal Reserve Chair Jerome Powell’s imminent Thursday address.

Stakeholders will meticulously assess Powell’s remarks for insights on upcoming rate determinations.

These evaluations will significantly shape gold’s upcoming price directions. Presently, with a failed attempt to breach the pivotal 200-day Simple Moving Average (SMA), a cautious approach is advised either for a robust rebound from the recent $1,810 region low or before any substantial price surge.

Gold Technical Analysis

Gold’s value successfully maintains its footing above the 100-day SMA, hovering near the emblematic $1,900 benchmark.

Technically, potential dips are expected to pique buying interest, predominantly anchored around the symbolic $1,900 threshold, aligning with the 100-day SMA. This threshold can be perceived as a critical juncture; a breach could predispose gold to further decline, targeting the subsequent support near the $1,868 mark, and progressing to the $1,860-1,855 bracket.

Conversely, the 200-day SMA, approximate to the recent swing peak in the $1,932-1,933 bracket, is likely to persist as a formidable resistance. Any sustained momentum beyond this might pave the way for gold’s accent towards the $1,945-1,947 resistance. Surpassing this barrier could propel the metal closer to the $1,970 landmark.

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ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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Gold’s Price Dynamics Amid Risk Sentiments and Upcoming Fed Directions

Gold Technical Analysis

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Gold’s Price Dynamics Amid Risk Sentiments and Upcoming Fed Directions

Gold Technical Analysis

Sidebar rates

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