- XAU/USD tries to rebound after reaching a demand zone.
- A new lower low activates more declines.
- The bias remains bullish, but the US data could move the price today.
The gold price dropped on Friday, but the bias still remains bullish. If the USD resumes its depreciation, the metal may turn to the upside at any time.
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Gold is trading at 1,925 at the time of writing, above yesterday’s low of $1,918. Yesterday, the fundamental factors moved the price. After the US data publication, the yellow metal registered sharp movements in both directions.
Advance Gross Domestic Product came in better than expected, reporting a 2.9% growth versus the 2.6% growth expected. In addition, Core Durable Goods Orders, Durable Goods Orders, Unemployment Claims, New Home Sales, and the Prelim Wholesale Inventories came in better than expected.
Today, the fundamentals should have an impact as well. The US Core PCE Price Index may report a 0.3% growth versus the 0.2% growth reported in the previous reporting period.
Furthermore, Pending Home Sales could report a 1.0% drop. Revised UoM Consumer Sentiment is expected to remain steady at 64.6 points, while Personal Spending and Personal Income data will also be released.
Gold price technical analysis: New leg higher
Technically, the gold challenges the descending pitchfork’s median line (ML). This represented dynamic support. The $1,922 and $1,919 former lows represented downside obstacles as well.
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Staying above these levels may signal a new upside movement toward the upper median line (UML). On the contrary, making a new lower low and stabilizing below the median line (ML) activates more declines and brings a selling opportunity.
Today’s better-than-expected US data should force the XAU/USD to drop slightly, while positive figures should lift the yellow metal. A valid breakdown below 1,919 static support could announce a potential drop toward the lower median line (LML). The 1,900 psychological level also stands as a potential downside target if the rate continues to drop.
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