Gold price gains some upward traction, but this is short-lived.
The Gold price displays some resistance at the critical 200 day Simple Moving Average (SMA). And draws some buyers during Thursday’s Asian session. The XAUUSD is now trading slightly around $1,920. Up roughly 0.15% on the day, and appears to have broken a three-day losing run. To over a one-week low reached on Wednesday.
Concerns over China’s worsening economic conditions. As well as continuous US China trade hostilities, continue to have an impact on investor sentiment. This is clear from a generally softer tone in the equities markets. And it turns out to be a crucial aspect that helps gold’s safe-haven position. Aside from that, the sluggish price movement of the US Dollar (USD) gives additional support to the Gold price. Albeit any major appreciating move remains elusive.
Bets on additional Fed rate rises acting as a tailwind for the dollar and capping the gains.
The chances for additional Fed policy tightening, supported by positive US macro data on Wednesday. Could restrict any major USD corrective slide and constrain gains for the Gold.
According to the Institute for Supply Management (ISM). Business activity in the US services sector unexpectedly increased in August. And its non manufacturing PMI increased from 52.7 in July to 54.5 last month the highest level since June. This is the highest reading since February.
Additional report data indicated an increase in new orders. Indicating a healthy US economy, and higher Prices Paid sub-components. Which were viewed as potential signals of still high inflation pressures. This boosted the chances of another 25 basis point (bps) Fed rate hike by the end of the year. Bringing the yield on the benchmark 10-year US government bond closer to the August 23 top and the USD to its highest level since March 9. Because of the aforementioned underlying backdrop. It is smart to wait for any follow through purchasing around the Gold price before concluding. That the current decline from a one-month high, around the $1,953 mark reached last Friday, has run its course. OnAcceptance below the theoretically critical 200-day SMA. On the other hand, is required to reinforce the bearish bias.
Gold Traders are looking for US Weekly Initial Jobles.
Traders are now looking for short term chances in the US Weekly Initial Jobless Claims report.
