- The bias remains bullish as long as it stays above the R2.
- Taking out the static support opens the door for more declines.
- The US data should have a major impact today.
The gold price is trading in the red at $2,036 at the time of writing. The price turned downside as the US dollar found the bottom and bounced off.
The US Prelim GDP, Prelim GDP Price Index, and Prelim Wholesale Inventories came in better than expected. The Dollar Index edges higher as the US economy shows robustness. USD’s further appreciation should force the XAU/USD to drop significantly.
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Today, the Chinese Manufacturing PMI came in at 49.4 points versus the expected 49.8 points, confirming the contraction. In comparison, the Non-Manufacturing PMI dropped to 50.2 points from 50.6 points, even if the traders expected a potential growth of 50.9 points. Australia, Japan, and the Eurozone reported mixed data.
Still, the traders changed their focus to the United States data. The Core PCE Price Index may report a 0.2% growth, Unemployment Claims could be reported at 219K in the last week, Chicago PMI is expected at 46.0 points, while Pending Home Sales could announce a 1.9% drop.
In addition, Personal Spending and Pending Income data will be released as well. Poor economic data could help the XAU/USD to resume its growth.
Gold Price Technical Analysis: Sliding Down
Technically, the XAU/USD found resistance at the ascending pitchfork’s upper median line (uml). Now, it moves sideways in the short term. However, the bias remains bullish if it stays above the weekly R2 of $2,034. This stands as a static support. Testing it and registering only false breakdowns could announce a new bullish momentum.
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On the contrary, taking out the R2 opens the door for a downward movement towards the R1 (2,018) and down to the median line (ml).
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