Gold Price Sell-Off Slows Ahead of US Data Releases
Gold (XAU) Price, News and Chart:
- The US dollar remains strong with heavyweight data and releases ahead.
- The RSI indicator is at a four-and-a-half month low.
Gold’s sharp sell-off in the past two weeks has ground to a halt just above its recent six-week low and is now waiting for heavyweight US data releases to decide its next move. The strong US dollar, boosted by last week’s expectation beating US Q4 GDP release and Tuesday’s strong ISM non-manufacturing data, halted the precious metal’s run-up and saw sellers hold sway. Ahead, the US Beige Book later today, while Thursday’s initial jobless claims data will be closely parsed before Friday’s monthly US labor report (non-farm payrolls) give us the latest cue to the strength of the US economy.
The daily Gold chart shows that horizontal support at $1,277/oz. held on Tuesday and may prevent further losses, all things being equal. The RSI indicator is also nearing oversold territory and is at its lowest level since mid-August 2018. A break below this support would open the way to 50% Fibonacci retracement at $1,262.8/oz. which currently guards the important 200-day moving average at $1,242/oz. A bullish run may see Gold attempt to retrace the recent gap between $1,297/oz. and $1,312/oz.
Gold Daily Price Chart (April 2018 – March 6, 2019)
Retail traders are 77.5% net-long Gold according to the latest IG Client Sentiment Data, a bearish contrarian indicator. Recent changes in daily and weekly sentiment however give us a stronger bearish trading bias.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.