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  • The Food and Drug Administration (FDA) granted full approval for the Pfizer/BioNTech COVID-19 vaccine.
  • Gold price forecast remains bullish above an upward trendline support level of 1,796.
  • Forex trading market participants may sell below the $1795 level to target the $1,780 level. 

During Wednesday’s Asian trading session, the Safe-Haven-metal price extended its previous-day declining streak. The precious metal drew some further offers around the $1,800 level as the US dollar ticked upwards. Moreover, investors looked at the US Federal Reserve’s guidance on asset tapering and interest rate hikes. The gold price forecast remains bullish above an upward trendline support level of 1,796.

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The heavy overnight upticks in US Treasury bond yields helped the USD stall its recent corrective decline from a nine-and-half-month high. Therefore, it helps regain some positive traction. Meanwhile, the upbeat market sentiment, backed by a combination of factors, undermined the safe-haven appeal of the yellow metal.

The FDA granted full approval for the Pfizer/BioNTech COVID-19

The bullish bias in the market trading sentiment appeared after the US Food and Drug Administration (FDA) granted full approval for the Pfizer/BioNTech COVID-19 vaccine.

In contrast, a surge in Delta covid variant cases globally is denting the tapering expectations. That keeps challenging the market trading mood, which may help the gold prices to limit their deeper losses. The yellow metal price is trading at 1,794.70 and consolidating in the range between 1,791.87-1,803.20.

Vaccine Optimism Weights on Gold Prices

The market trading sentiment succeeded in extending its overnight upbeat performance despite the worries about the fast-spreading Delta variant of the coronavirus.

The risk-on sentiment was evident from a generally positive tone around the equity markets, which opposed the safe-haven yellow metal. However, the US Food and Drug Administration (FDA) granted full approval for the Pfizer/BioNTech COVID-19 vaccine, significantly supporting the market’s trading mood.

This, in turn, helped reduce worries about the fast-spreading Delta variant of the coronavirus and boosted investors’ confidence. Thus, the upbeat tone in the global equity markets undermined the safe-haven appeal of the yellow metal.

The Bullish US Dollar Keeping Gold Under Pressure

The cautious tone ahead of Fed Chair Jerome Powell’s speech at the Jackson Hole Symposium kept the haven demand for the greenback underpinned. In that way, the gains in the US dollar held the bullion prices under pressure. That’s because the price of gold is inversely related to the price of the US dollar.

Looking forward, market traders will keep their eyes on the Fed’s annual Jackson Hole symposium, which is due to take place from August 26 to August 28. Meanwhile, the release of US Durable Goods Orders might provide some impetus to gold prices later during the early North American session.

Gold Price Forecast
XAU/USD Daily Chart

Gold Price Forecast – Technical Levels

Support Resistance

1800.25 1809.65

1796.75 1815.55

1790.85 1819.05

Pivot Point: 1806.15

Gold Price Forecast – Daily Technical Analysis: Upward Trendline Support 

Gold price forecast remains bullish above an upward trendline support level of 1,796. On the 4-hourly timeframe, the downward trendline was extending resistance at the 1784.05 level. The closing of candles over this confirms a bullish breakout of a triangle pattern. Therefore, the bullish bias dominated on Wednesday.

On the bullish side, the resistance stays at the 1,810 level, and a bullish breakout of this level could extend the buying trend to the 1,815 and 1,830 levels. Furthermore, the breakout of 1,795 support levels could bring sellers to the 1,773 level.

The 50 day EMA (exponential moving average – red line) operates at around the $1790 level, supporting gold’s upward trend. Moreover, the leading indicator, Stochastic RSI, is held in a buying zone. Thus, I will be looking for a buy trade on Tuesday. 

Therefore, the Forex trading market participants may buy sell below the $1795 level to target the $1,780 level. Alternatively, buying trades can be seen on a bullish breakout below the $1795 level today. All the best!

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