Gold Weekly Analysis: As long as above 1760, its uptrend.
Gold suffered heavy losses last Friday. In addition, the 10-year US Treasury bond yield rose more than 1% on Friday, indicating that investors are becoming less confident in the economy's stability and strength of their earnings potentials.
However, the latest retail sales report shows positive economic data like better-than-expected retail figures for October 2021. In addition, it is a positive sign that the upcoming asset purchase program may start soon from Federal Reserve Chair Powell next month. These reports and investors' optimism sent XAU/USD crashing down to $1763, and the market closed at 1766.45 price zone on Friday.
The October Manufacturing Survey from the Federal Reserve Bank of Philadelphia and the weekly Initial Jobless Claims data from the United States will directly impact the gold price.
If the report indicates that economic growth is slowing, which could impact investors' confidence in the coming quarter, that may negatively impact the USD.
Bond VS Gol's Move. See the chart. When bond rate drop, gold price rise. When Bond rate rise, Gold price drop.
There has been no significant increase seen after four consecutive quarters of positive figures ahead of current results. The latest available data was released earlier last week due to weak overseas economies such as China's manufacturing sector, which slowed down again last month.
Gold is likely to come under bearish pressure in case the greenback capitalizes on rising yields. The benchmark 10-year US T-bond yield has maintained above the key 1.5% level despite weekly declines, but this could change with more economic instability expected soon.
Technical View
Gold dropped massively last Friday, but it is still in an uptrend. However, it is hard to say that the gold will break below the ascending trend line or continue its uptrend next week.
As long as the gold price is above 1760.00, we must not think about selling gold, though retail sales printed positive last week. From the present rate, an initial resistance is identified at the $1780 price zone. Breaking above 1780 may open the door for the $1805/1807 price zone. To the upside, our final target is a $1730 price zone.
On the other hand, breaking below the uptrend will be invalid. Gold's price breaking below $1760, our downside first target is $1750/1745. after breaking below $1745, our final target is the $1725/1720 price zone.
However, the latest retail sales report shows positive economic data like better-than-expected retail figures for October 2021. In addition, it is a positive sign that the upcoming asset purchase program may start soon from Federal Reserve Chair Powell next month. These reports and investors' optimism sent XAU/USD crashing down to $1763, and the market closed at 1766.45 price zone on Friday.
The October Manufacturing Survey from the Federal Reserve Bank of Philadelphia and the weekly Initial Jobless Claims data from the United States will directly impact the gold price.
If the report indicates that economic growth is slowing, which could impact investors' confidence in the coming quarter, that may negatively impact the USD.
There has been no significant increase seen after four consecutive quarters of positive figures ahead of current results. The latest available data was released earlier last week due to weak overseas economies such as China's manufacturing sector, which slowed down again last month.
Gold is likely to come under bearish pressure in case the greenback capitalizes on rising yields. The benchmark 10-year US T-bond yield has maintained above the key 1.5% level despite weekly declines, but this could change with more economic instability expected soon.
Technical View
Gold dropped massively last Friday, but it is still in an uptrend. However, it is hard to say that the gold will break below the ascending trend line or continue its uptrend next week.
As long as the gold price is above 1760.00, we must not think about selling gold, though retail sales printed positive last week. From the present rate, an initial resistance is identified at the $1780 price zone. Breaking above 1780 may open the door for the $1805/1807 price zone. To the upside, our final target is a $1730 price zone.
On the other hand, breaking below the uptrend will be invalid. Gold's price breaking below $1760, our downside first target is $1750/1745. after breaking below $1745, our final target is the $1725/1720 price zone.
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