- Gold price remains supported above the 21 DMA with an eye on $1,870.
- Risk appetite inflows and dollar decline coupled with yields favor XAUUSD bulls.
- The results of the US ADP survey on employment may reignite the Fed’s aggressive tightening bets and limit the rebound in gold.
the price of gold it is supported by the previous bounce from the 10-day lows of $1,829, as the bulls remain in full control in the European session.
European markets find some solace in the decline in oil prices, amid hopes of a concerted effort to increase supply, which has helped to lift general market sentiment and trigger a new round of dollar sell-off American.
US Treasury yields have also retreated across the curve, contributing to the dollar’s decline. The pullback in US rates could be linked to profit-taking after US benchmark 10-year yields faced rejection just below the key 3% level.
The shiny metal also continues to benefit from persistent concerns about rising global inflation, which could dampen the economic outlook. Additionally, renewed concerns over US-China trade and the ongoing Russia-Ukraine crisis keep sentiment around the traditional safe haven.
Gold traders now await US ADP employment data for fresh dollar valuations. A figure above the expected figure of 300,000 in May could once again bring to the fore the aggressive tightening expectations of the Fed, which could stop the rise in gold.
However, the main risk this week remains the US Non-Farm Payrolls data for May, which will be eagerly awaited for the metal’s next direction.
Gold Price: Daily Chart
The next key resistance level is at $1,860, which is the downtrend line hurdle. A firm break above this latest level will require a retest of the previous week’s high of $1,870.
The 14-day Relative Strength Index (RSI) is just below the mid-line, suggesting that recovery attempts are likely to remain shallow and sellers could jump on the rebound.
A break of the 21 DMA at $1,845 will again expose the 200 DMA support at $1,841, below which the previous day’s low at $1,829 will be tested.
additional levels
Source: Fx Street
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