Gold Surges Beyond $2,000 as U.S. Interest Rates Decline
Gold prices attracted buyers and breached the $2,000 mark in the early hours of Wednesday's trading session in Asia. The precious metal's upward momentum is fueled by lower U.S. Treasury bond yields and a weaker U.S. dollar. The daily chart of XAU/USD illustrates a bullish trend, supported by technical indicators such as the Moving Average Convergence Divergence (MACD) and the Relative Strength Index (RSI) trending upward, still comfortably away from overbought levels. However, a significant resistance level appears around $2,010, an area that constrained the upward trend in October. Consolidation above this level is essential to open up opportunities for further gains.
On the 4-hour chart, the trend also leans towards an upward trajectory. Immediate support rests at $1,994, followed by the Simple Moving Average (SMA) 20 at $1,984. The uptrend line at $1,978 seems to be the last line of defense for a more substantial price correction.
Support Levels: $1,994, $1,985, $1,978
Resistance Levels: $2,010, $2,023, $2,029
Spot gold surged strongly on Tuesday, rising from below $1,980 to near the crucial resistance zone at $2,010. This upward movement occurred even as stock prices fell and the U.S. dollar stabilized.
Gold's recovery on Tuesday took place as U.S. Treasury bond yields remained steady. After reaching $2,007, XAU/USD retraced back to the $2,000 level. The overall trend still favors an upward trajectory, supported by expectations that the Federal Reserve has completed interest rate hikes, alleviating pressure on the greenback.
Market participants are awaiting the FOMC minutes. On Wednesday, crucial U.S. data, including Jobless Claims and Durable Goods Orders, will be released. Negative readings from these figures could push XAU/USD further above $2,000. However, at the moment, it appears not ready to ensure a stronger rebound unless U.S. bond yields decisively decrease, indicating that they have peaked.
On the 4-hour chart, the trend also leans towards an upward trajectory. Immediate support rests at $1,994, followed by the Simple Moving Average (SMA) 20 at $1,984. The uptrend line at $1,978 seems to be the last line of defense for a more substantial price correction.
Support Levels: $1,994, $1,985, $1,978
Resistance Levels: $2,010, $2,023, $2,029
Spot gold surged strongly on Tuesday, rising from below $1,980 to near the crucial resistance zone at $2,010. This upward movement occurred even as stock prices fell and the U.S. dollar stabilized.
Gold's recovery on Tuesday took place as U.S. Treasury bond yields remained steady. After reaching $2,007, XAU/USD retraced back to the $2,000 level. The overall trend still favors an upward trajectory, supported by expectations that the Federal Reserve has completed interest rate hikes, alleviating pressure on the greenback.
Market participants are awaiting the FOMC minutes. On Wednesday, crucial U.S. data, including Jobless Claims and Durable Goods Orders, will be released. Negative readings from these figures could push XAU/USD further above $2,000. However, at the moment, it appears not ready to ensure a stronger rebound unless U.S. bond yields decisively decrease, indicating that they have peaked.
