- A new higher high activates further growth.
- Taking out 2,041 signals a deeper drop.
- The US data could change the sentiment.
The gold price marked a fresh multi-day top at $2,050 yesterday amid a weaker US dollar. Now, the metal has retreated a little and is trading at $2,045 at the time of writing.
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The bias remains bullish despite the corrective downside. After yesterday’s strong rally, the price is retracing amid profit-taking.
The US Unemployment Claims came in at 215K above 209K expected, the Core PCE Price Index rose by 0.4% as expected, Personal Income reported a 0.1% growth, versus the 0.4% growth estimated, while Personal Spending came in line with expectations.
Furthermore, the Chicago PMI and Pending Home Sales came in worse than expected. Still, the greenback rallied despite mixed economic figures. XAU/USD’s rally was somehow expected after some poor figures.
Today, Chinese Manufacturing PMI came in at 49.1 points as expected, Non-Manufacturing PMI jumped from 50.7 points to 51.4 points, above 50.9 points forecasted, while Caixin Manufacturing PMI was reported at 50.9 points, above 50.7 estimates. Later, the Eurozone CPI Flash Estimate and Core CPI Flash Estimate should have an impact as well.
However, only the US economic data could change the sentiment. The ISM Manufacturing PMI and the Revised UoM Consumer Sentiment represent high-impact events.
In addition, the ISM Manufacturing Price, Construction Spending, Revised UoM Inflation Expectations, and Wards Total Vehicle Sales data will be released as well.
Gold Price Technical Analysis: Correcting Gains
Technically, XAU/USD found resistance right below the R1 of $2,051. It has printed only false breakouts through the median line (ml) and now it has turned to the downside after retesting the dynamic resistance.
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The first downside target and obstacle is represented by the $2,041 level. The retreat is natural after the last bullish momentum. The price could try to confirm the breakouts from the range movement.
Dropping and closing below $2,041 may result in more declines. An upside continuation should be confirmed by a new higher high if the price jumps and closes above the median line (ml) and the R1 (2,051).
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