After a bright start to the week, gold prices fell early Tuesday. As the United States Dollar (USD) continued to rise across the board. The gold price is now looking for new trading momentum from the top-tier. US JOLTS Job Openings and ISM Manufacturing PMI data.
JOLTS Job Openings in the United States and ISM Manufacturing PMI data.
The US Dollar is extending its prior gains in a cautious market environment. As optimism about anticipated Chinese stimulus fades. as the economy continues to function poorly. The Caixin Manufacturing Purchasing Managers’ Index (PMI) in China fell to 49.2 in July, down from 50.5 the previous month. And 50.3 predicted. Disappointing Chinese PMIs rekindled concerns about the economy. Contributing to the current leg upward in the safe-haven US Dollar at the expense of the gold price.
Asian markets have reversed early gains. While US Treasury bond yields are stabilizing around the 4.0% crucial level, as investors await a fresh set of top-tier economic data from the US for new signals on the US Federal Reserve (Fed) interest rate path.
Better-than-expected preliminary GDP and lowering inflation in the Eurozone eased markets on Monday, fueling risk-on trades across financial markets. However, the US dollar remained strong. Benefit from position rebalancing following the previous week’s Fed decision and ahead of Friday’s release of US Nonfarm Payrolls data.
The gold price initially extended its recovery from two-week lows of $1,943 set last Friday, but gold sellers remained above the $1,970 round number, undoing some of the day’s gains.
In the coming day, US JOLTS Job Openings are expected to dip 9.62 million in June. Compared to 9.824 million in June. A prolonged decrease in job postings below 10 million creates a quandary for the Fed. As the US labor market remains out of balance. As a result, weak job data may rekindle selling interest in the US Dollar. Prompting gold bulls to reclaim upside traction. Furthermore, if the ISM in the United States. If the Manufacturing PMI reveals a deepening decline, the US Dollar will fall. Further, raising predictions that the Fed is reaching the end of its tightening cycle.
Gold Technical analysis
On Monday, the gold price failed to gain acceptance above the bullish 100-Daily Moving Averages (DMA) of $1,970, as seen on the daily chart.
However, the 14-day Relative Strength Index remains strong above the midline, indicating that risks for Gold price remain tilted to the upside and that any downturn could be viewed as a favorable buying opportunity for traders. The 21 and 50 DMAs Bull Cross confirmed last week gives credence to gold’s bullish potential.
A daily closing above the 100 DMA at $1,970 is required to resurrect the market. recent rally, with sights set on multi-month highs of $1,988. Prior to that, Gold buyers will face stiff resistance from Thursday’s high of $1,982.
Gold, on the other hand, could see a brief decline toward 21 and 50 DMA confluence support near $1,950. A break below the latter will open up more downside pressure toward the two-week lows of $1,943, while a breach below the $1,930 round figure may be tested.
