Search ForexCrunch
  • Gold flat for the day, still testing the $1,900 zone.
  • Weaker US dollar and risk appetite support upside in metals.

The recovery in gold after last week sharp decline continues to be capped by the $1,900/oz area. Recently, boosted by a slide of the US dollar, XAU/USD rose to $1,902 reaching the highest level in a week, but it failed to hold above $1,900 and pulled back.

The DXY fell to the lowest in a week under 93.70. In Wall Street, equity prices are sharply higher the day after the first presidential debate. The Dow Jones is rising 1.80%, and the S&P 500 climbs 1.50%. The combination of a weaker US dollar and risk appetite helped gold move off lows, but metals are in negative territory for the day.

XAU/USD is trading at $1,895, holding a bullish intraday tone. In order to clear the way to more gains, it needs to consolidate above $1,900. The key support to the very short-term bullish bias is seen at the 20-SMA in the 4-hour chart around $1,880 and also at $1,875. Below the last one, another test of the $1,850 area seems likely.

XAU/USD 4-hour chart