Gold (XAU/USD) failed to sustain at weekly highs around $1740 on Thursday, ending the day in the red at $1724. On the final trading day of this week, XAU/USD bears are testing bullish commitments above $1700, as FXStreet’s Dhwani Mehta reports.
See – Gold Price Analysis: XAU/USD to end the year close to $1600 – CE
“The reflation theme is back in play, thanks to the upbeat remarks from US President Joe Biden, who talked up the vaccine campaign amid the $1.9 trillion stimulus passage. Therefore, gold could bear the brunt if the uptrend in the US rates resumes. On the macro front, the US PPI release will be eyed while the focus will continue to remain on the yield play.”
“Gold’s 4-hour chart shows that the price has pierced the critical support at $1717, which is the bullish 21-simple moving average (SMA). The $1700 round number could offer some cushion to the XAU bulls before they target the multi-month troughs at $1677.”
“The Relative Strength Index (RSI) has turned flat while holding above the midline, suggesting that the XAU buyers still remain hopeful.”
“Thursday’s high at $1739 could be probed again, above which the 100-SMA at $1745 remains on the buyers’ radars. The next stop for the bulls is seen at $1760, the March 1 high.”