Gold Price Analysis: XAU/USD surrenders intraday gains, back around $1860 level

• Gold struggled to capitalize on its intraday positive move to levels beyond the $1870 level.
• A goodish rebound in the equity markets was seen weighing on the safe-haven commodity.
• Renewed USD selling bias extended some support to the metal ahead of the US macro data.

Gold surrendered its intraday gains to the $1872 region and has now dropped to the lower end of its daily trading range. The commodity was last seen hovering around the $1860 region, nearly unchanged for the day.

The emergence of some fresh selling around the US dollar benefitted the dollar-denominated commodity and was seen as one of the key factors behind the early uptick. The attempted positive move quickly ran out of the steam amid a goodish rebound in the equity markets, which tends to undermine demand for safe-haven XAU/USD.

Investors looked past the US President Donald Trump’s threat not to sign a long-awaited $892 billion COVID-19 stimulus bill, instead took cues from the reopening of the UK-French border. This signalled a step back toward normality after the discovery of a new variant of the coronavirus and provided a modest lift to investors’ sentiment.

Apart from this, the pullback lacked any obvious fundamental catalyst and seemed limited. Hence, it will be prudent to wait for some follow-through selling below weekly lows, around the $1855 region, before placing fresh bearish bets. This will set the stage for an extension of this week’s pullback from multi-week tops, or levels beyond the $1900 mark touched on Monday.

Moving ahead, market participants now look forward to the US economic docket, highlighting the release of Durable Goods Ordes and Initial Weekly Jobless Claims. The data might influence the USD price dynamics. This, along with the broader market risk sentiment, will be looked upon for some trading opportunities around the XAU/USD.

Technical levels to watch