* It continues to lose steam for the third day in a row and is down to its lowest level in almost a month.
* A combination of factors continues to strengthen the USD and direct flows away from XAU/USD.
* Concerns about the global economic slowdown may provide some support for the safe-haven commodity.
The price of gold is falling for the third day in a row – also marking the sixth day of negative movement from the previous seven – and falling to its lowest level in almost a month during the first half of the European session. XAU/USD is currently trading above the $1,970 level, down around 0.50% on the day, and is under pressure from a combination of factors.
Optimism on US debt ceiling puts more pressure on the safe-haven currency XAU/USD: –
It should be noted that recent optimistic statements by several Fed officials have contradicted market expectations of a rate cut later this year. Moreover, US President Joe Biden and Republican Congressman Kevin McCarthy confirmed their intention to strike a deal soon to raise the government’s debt ceiling of $31.4 trillion. This helps allay fears of an unprecedented US debt default and boosts investor confidence, adding pressure on the safe-haven gold price.
Thursday’s US macro data and the Fed are looking for fresh impetus:-
In the meantime, traders will look to the US economic calendar on Thursday, which includes the usual weekly jobless claims release, the Philly Fed Manufacturing Index and Existing Home Sales, for some impetus. Apart from this, the scheduled words of Fed members, US bond yields and US debt limit negotiations will influence the price dynamics of the US dollar. This, combined with the broader risk sentiment, could result in short-term trading opportunities around the price of gold.
As for the technical side:
* $1953 is a new area for building buying positions, targeting $2010 as a first target and 2035 as a second target, with a daily closing stop loss below $1935.
* Please be careful and adhere to an appropriate contract size for your portfolio to avoid huge losses that you are indispensable, especially since strong fluctuations will occur in the market tomorrow.
Gold in the daily frame
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