Gold Price Forecast: XAU/USD stands near its daily high, around $1,780

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  • The price of gold registers new offers before the appearance of certain sales around the US dollar.
  • Falling US Treasury yields weigh on the dollar and benefit non-yielding metals.
  • The hike appears limited amid uncertainty over future rate hikes by the Federal Reserve.

the price of gold regains positive traction on Tuesday and reverses some of the previous day’s pullback from a five-month high. The steady intraday rise continues through the early hours of the North American session and lifts XAU/USD to a new daily high, around the $1,780-$1,781 zone in the last hour.

The weakening of the US dollar supports the price of gold

The US dollar struggles to take advantage of a solid overnight rebound from its lowest level since late June and attracts some sellers near a technically significant 200-day SMA. As investors seek clarity on the Federal Reserve’s rate hike path, a further drop in US Treasury yields weighs on the dollar. This, in turn, is seen as a key factor driving flows into the dollar-denominated gold price.

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Following Friday’s upbeat US monthly jobs report, the better-than-expected ISM services PMI on Monday pointed to a resilient economy. The positive macroeconomic data from the United States raises fears that the Federal Reserve will raise rates more than expected. However, investors seem convinced that the US central bank will slow the pace of its tightening cycle and are anticipating a 50 basis point rate hike in December.

Focus remains on key data/events in the coming week

Therefore, the markets’ attention will continue to be focused on the Federal Open Market Committee (FOMC) monetary policy meeting on December 13 and 14. Facing key event risk, investors will face the release of the latest US consumer inflation figures for November, which could influence the Fed’s near-term policy outlook. This, in turn, will play a key role in driving the gold price out of yield and help determine the next leg of a directional move.

Recession fears bolster XAU/USD safe haven

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Meanwhile, growing concern about a deeper global economic downturn dwarfs the optimism generated by the easing of COVID-19 restrictions in China. This is reflected in the prevailing caution in equity markets and should continue to provide some support for gold. However, traders may refrain from aggressive bets and prefer to stay on the sidelines in the absence of any significant US macroeconomic data. the market.

Gold Price Technical Outlook

From a technical standpoint, repeated failures to find acceptance or build momentum beyond the all-important 200-day SMA favor XAU/USD bears. That being said, the appearance of further buying on Tuesday warrants some caution before confirming a near-term top for the price of gold and positioning for a deeper corrective pullback.

Meanwhile, a further move above the horizontal resistance at $1,782-$1,783 could lift the price of gold back to the 200 DMA, closer to $1,800. The next major hurdle lies near the $1,810 area, or the multi-month high reached on Monday, above which the price of gold looks set to appreciate further. Momentum could then accelerate towards the $1,830 intermediate hurdle en route to the $1,843-$1,845 bid zone.

On the other hand, the low around the $1,769-$1,768 area now becomes immediate support to be defended before the break of the horizontal resistance of $1,761-$1,760. A convincing break below would nullify any near-term positive outlook and shift the bias in favor of the bears. The gold price could then become vulnerable and accelerate the decline towards the $1,738-1,737 area before falling to the $1,725 ​​level.

Key Gold Levels to Watch

XAU/USD

Overview
Last price today 1778.13
daily change today 11.37
today’s daily variation 0.64
today’s daily opening 1766.76
Trends
daily SMA20 1757.19
daily SMA50 1700.36
daily SMA100 1715.11
daily SMA200 1795.13
levels
previous daily high 1810.12
previous daily low 1765.89
Previous Weekly High 1804.52
previous weekly low 1739.72
Previous Monthly High 1786.55
Previous monthly minimum 1616.69
Fibonacci daily 38.2 1782.79
Fibonacci 61.8% daily 1793.22
Daily Pivot Point S1 1751.73
Daily Pivot Point S2 1736.69
Daily Pivot Point S3 1707.5
Daily Pivot Point R1 1795.96
Daily Pivot Point R2 1825.15
Daily Pivot Point R3 1840.19

Source: Fx Street

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