- Gold consolidated in a range at the beginning of the American session.
- Expectations of a reduction by the Fed propped up the USD and limited the metal’s gains.
- Stagflation fears helped limit any significant drop for gold – safe haven.
The oro (XAU) it lacks a firm directional bias and oscillates between tepid gains and minor losses, just above the $ 1,750 level during the early North American session. A combination of divergent forces failed to provide any momentum and led to moderate price action following Friday’s trend reversal following US data to the $ 1,781 zone, or two-week highs.
From current levels, any subsequent upward movement is likely to face strong resistance near the $ 1,770 zone. Some subsequent purchases have the potential to push gold prices towards the horizontal barrier of $ 1,783-84. A sustained force beyond should allow the bulls to regain the round $ 1,800 level.
On the other hand, the $ 1,750 zone now appears to have emerged as strong immediate support. A convincing break below could lead to aggressive technical selling and accelerate the slide towards September’s monthly lows around the $ 1,722-21 zone. Gold could eventually drop to test the $ 1,700 level en route to August’s monthly lows around the $ 1,687 zone.