XAUUSD Current Price: $1,954.05
Fears of a US recession and geopolitical jitters are still the main market movers.
US Federal Reserve officials cooled down expectations for a 75 bps rate hike.XAUUSD sheds some ground, but buyers would not give up on their $2,000 target.
Rising government bond yields put spot gold under pressure, with the bright metal falling to $1,939.25 a troy ounce, its lowest in over a week. Yields eased from their early highs, which helped gold to recover up to the current $1950.00 price zone, pretty much flat on a daily basis. Concerns about a potential recession in the US and geopolitical tensions in Europe are keeping investors on their toes and high-yielding assets on the backfoot.
For a change, Wall Street is on the rise for a second consecutive day, as market players are focused on earnings reports. Nevertheless, the overall sentiment is negative, temporarily pausing on Wednesday. Among other things, safe-have assets receded after several US Federal Reserve officials dismissed the case for a 75 bps rate hike as presented earlier in the week by St. Louis Fed James Bullard.
XAUUSD Technical Outlook
XAUUSD’s daily chart shows that it met buyers at around a mildly bullish 20 SMA, while the longer ones maintain their modest bullish slopes below it. The RSI indicator has turned flat above its 50 line, while the Momentum indicator keeps heading south within positive levels, reflecting limited selling interest.
According to the 4-hour chart, the risk is skewed to the downside. The metal is seesawing around a directionless 200 SMA and barely holding above an also flat 100 SMA, while the 20 SMA heads firmly lower above the current level. Technical indicators, in the meantime, remain within negative levels, with the Momentum heading firmly lower and the RSI consolidating around 42.
Another leg lower would become possible on a break below 1,939.25, so far the weekly low, although the near-term bearish view does not invalidate the longer-term bullish potential within a risk-averse environment.
EUR/USD struggles to recover above 1.0850.The shared currency extended the bounce from two-year lows on Wednesday but so far is having a hard time consolidating above the 1.0850 area. Hawkish comments from ECB’s Kazaks and pullback in US yields and the greenback have been the main drivers behind the EUR/USD recovery.
GBP/USD clings to daily recovery gains near 1.3050.GBP/USD regained its traction after dipping below 1.3000 earlier in the day but met resistance near 1.3070. The pair consolidates its gains around mid-1.3000s as the greenback stays under bearish pressure ahead of Fedspeak.
XAUUSD retreats, but is poised to challenge its record high.Rising government bond yields put spot gold under pressure, with the bright metal falling to $1,939.25 a troy ounce, its lowest in over a week. Yields eased from their early highs, which helped gold to recover up to the current $1950.00 price zone, pretty much flat on a daily basis.