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  • 10-year US Treasury bond yield stays flat on the day.
  • US Dollar Index continues to move sideways near mid-97s.
  • Coming up: Durable goods orders, Manufacturing Services PMI data from the US.

After spending the first half of the day moving sideways a little above the $1,490 handle, the XAU/USD pair came under modest bearish pressure in the last hour and slumped to a fresh session low of $1,488. However, this latest drop is merely technical and doesn’t represent a change in the pair’s near-term sideways grind.

Attention remains on US data

In the second half of the day, investors will be paying close attention to the durable goods orders and the IHS Markit’s preliminary Manufacturing and Services Purchasing Managers’ Index (PMI) data from the United States will be looked upon for fresh clues regarding the possibility of the Federal Reserve announcing one more 25 basis-point  rate cut at its meeting next week.

Previewing today’s data, TD Securities analysts said that they are expecting durable goods orders to decline by 1.3% on a monthly basis in September.

“We expect both core orders series to also disappoint in September, with durables ex-transportation and core capex orders declining -0.2% and -0.8%, respectively,” analysts added. “Separately, the Kansas City  Fed  index and the preliminary Markit survey should provide additional clues regarding the performance of the manufacturing sector in October.”

Additionally, participants will be paying close attention to the European Central Bank’s interest rate decision and President Draghi’s remarks to understand how severe the economic slowdown in the eurozone is. If Draghi’s comments impact the market sentiment, the XAU/USD pair could react accordingly.

Technical levels to watch for