Confirming you are not from the U.S. or the Philippines

By giving this statement, I explicitly declare and confirm that:
  • I am not a U.S. citizen or resident
  • I am not a resident of the Philippines
  • I do not directly or indirectly own more than 10% of shares/voting rights/interest of the U.S. residents and/or do not control U.S. citizens or residents by other means
  • I am not under the direct or indirect ownership of more than 10% of shares/voting rights/interest and/or under the control of U.S. citizen or resident exercised by other means
  • I am not affiliated with U.S. citizens or residents in terms of Section 1504(a) of FATCA
  • I am aware of my liability for making a false declaration.
For the purposes of this statement, all U.S. dependent countries and territories are equalled to the main territory of the USA. I accept full responsibility for the accuracy of this declaration and commit to personally address and resolve any claims or issues that may arise from a breach of this statement.
We are dedicated to your privacy and the security of your personal information. We only collect emails to provide special offers and important information about our products and services. By submitting your email address, you agree to receive such letters from us. If you want to unsubscribe or have any questions or concerns, write to our Customer Support.
Octa trading broker
Open trading account
Back

Gold Price Forecast: XAU/USD tests key moving averages before next move

  • Gold lost its traction after rising above $1,820 on Tuesday.
  • XAU/USD fluctuates between the 100-day and 200-day SMAs.
  • Broad-based USD strength continues to limit gold's upside.

After dipping below $1,800 at the start of the week, gold managed to close virtually unchanged at $1,812 on Monday despite the broad-based USD strength. On Tuesday, XAU/USD gained traction and climbed to a daily high of $1,825 but failed to preserve its bullish momentum. As of writing, gold was posting small daily losses at $1,810.

The recent market action suggests that the precious metal is starting to find demand in the risk-averse market environment after losing its safe-haven status during the first half of the year.

Renewed concerns over the quick spread of the coronavirus Delta variant crippling the global economic recovery and inflation staying high for longer than expected triggered a flight to safety on Monday. Major global equity indexes suffered heavy losses and the benchmark 10-year US Treasury bond yield lost nearly 7% with investors seeking refuge. In the meantime, the USD gathered strength, especially against the risk-sensitive commodity currencies, and made it difficult for XAU/USD to push higher.

On Tuesday, the decisive rebound witnessed in Wall Street's main indexes seems to be limiting gold's gains. Moreover, the US Dollar Index, which tracks the USD's performance against a basket of six major currencies, stays in the positive territory and puts additional weight on XAU/USD's shoulders.

The only data from the US showed earlier in the day that Housing Starts increased by 6.3% in June, bettering May's reading of 2.1%. On a negative note, Building Permits declined by 5.1% in the same period.

There won't be any high-tier macroeconomic data releases on Wednesday. With market participants assessing how the shift in the risk sentiment will impact assets' valuations moving forward, gold's next move is likely to come on a failure of a key technical level.

Gold technical outlook

Despite the recent fluctuations, the Relative Strength Index (RSI) indicator on the daily chart is moving sideways around 50, underlining XAU/USD indecisiveness in the near term.

Gold's volatility is likely to pick up in case the price breaks out of the horizontal range that seems to have formed between $1,790 (100-day SMA, 20-day SMA) and $1,825 (200-day SMA). A daily close above the resistance area is likely to open the door for additional gains toward $1,835 (50-day SMA).

On the flip side, $1,770 (Fibonacci 61.8% retracement of April-June uptrend) aligns as the next target below $1,790 with $1,800 (psychological level) possibly acting as interim support ahead of these levels. 

Additional levels to watch for

 

USD/JPY extends rebound, approaches 110.00 as US yields soar

The USD/JPY rose further and climbed to 109.95, reaching a fresh daily high. It had risen almost a hundred pips from Monday's low, boosted by a recove
Read more Previous

USD/CAD drops toward 1.2700 amid modest oil rebound

The USD/CAD pair extended its rally and advanced beyond 1.2800 for the first time in five months. With risk flows starting to dominate the financial m
Read more Next