As the European session begins on Wednesday, the price of gold (XAU/USD) maintains its downward trend below the $2,900 mark, despite the absence of follow-through selling and its continued proximity to the all-time high reached the day before. The hawkish comments made by Federal Reserve (Fed) Chair Jerome Powell on Tuesday further depress the non-yielding yellow metal and draw some purchasers to the US Dollar (USD). In addition, a positive risk attitude encourages some profit-taking for the second day in a row.
Investors are still worried about the possible economic effects of a global trade war and US President Donald Trump's trade tariffs. Furthermore, geopolitical worries are still driving the price of gold, which is a safe haven. Additionally, traders were hesitant to make large wagers and instead chose to hold off until later today, when the most recent US consumer inflation data is released. As a result, bearish traders should exercise caution until it is confirmed that the XAU/USD's long-standing upward trend has petered out.
Technically speaking, the yellow metal has been declining due to overbought conditions. Any more decline, however, might still be viewed as a buying opportunity and would be restricted to the $2,855-2,850 range. Support around the $2,835 region, which is close to the 4-hour EMA, comes next. If it is broken, this might push the XAU/USD closer to the $2,800 level.
Conversely, bulls may now hold off on making new wagers until they see a rise back above the $2,900 immediate hurdle. The gold price may return to the $2,942-2,943 range or the all-time high reached on Tuesday as a result of the ensuing increase. An extension of the recent, well-established upswing that has been observed over the last two months or so would be made possible by some follow-through buying.
Investors are still worried about the possible economic effects of a global trade war and US President Donald Trump's trade tariffs. Furthermore, geopolitical worries are still driving the price of gold, which is a safe haven. Additionally, traders were hesitant to make large wagers and instead chose to hold off until later today, when the most recent US consumer inflation data is released. As a result, bearish traders should exercise caution until it is confirmed that the XAU/USD's long-standing upward trend has petered out.
Technically speaking, the yellow metal has been declining due to overbought conditions. Any more decline, however, might still be viewed as a buying opportunity and would be restricted to the $2,855-2,850 range. Support around the $2,835 region, which is close to the 4-hour EMA, comes next. If it is broken, this might push the XAU/USD closer to the $2,800 level.
Conversely, bulls may now hold off on making new wagers until they see a rise back above the $2,900 immediate hurdle. The gold price may return to the $2,942-2,943 range or the all-time high reached on Tuesday as a result of the ensuing increase. An extension of the recent, well-established upswing that has been observed over the last two months or so would be made possible by some follow-through buying.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.