- XAU/USD failed to hold onto gains amid a recovery of the US dollar across the board.
- Gold’s bullish bias in the short-term weakens after a pullback.
Gold prices peaked before the American session at $1,972, the highest level since September 2 and then pulled back more than $20. It failed to hold onto gains and printed a fresh daily low at $1,948. It quickly bounced back above $1,950 and as of writing it trades at $1,954 modestly lower for the day.
The yellow metal retreated amid a recovery of the US dollar across the board. The US dollar Index climbed from 92.78 the lowest in almost a week to 93.15, erasing all losses. At the same time equity prices in Wall Street moved off highs and US yield remained in positive ground near daily highs.
XAU/USD Technical outlook: Bullish short-term bias challenged
The short-term outlook still shows a bullish bias, despite the recent pullback. A consolidation below $1,950 would likely lead to a test of $1,935 that if broken would remove the positive tone. The critical support continues to be the $1,900 area.
On the upside, XAU/USD again found resistance around $1,970 and pulled back. Despite positive technical signs while below $1,975 the upside will continue to be limited.
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