Gold declines from nearly $1,860 despite lower T – yields from over two-week highs of $1,858 in the early European session, the price of gold is now declining.

Gold price has stalled, even on the weakening US dollar.

At $1,844, the price of bullion produced a daily ending above the negative 21-Daily Moving Average (DMA). Therefore, following the decline in the 14-day Relative Strength Index, Gold bulls flexed their muscles early on Monday before changing their path (RSI).

The 50.00 mark remains under threat from the momentum indicators, which might add to the extension of the corrective drop in the price of gold.

Gold Price Action Takeaway

If that happens, the gold price may drop further to challenge the 21 DMA’s support-turned-resistance mark. If the latter is clearly broken to the south A challenge of Friday’s bottom at $1,835 will be required.

Alternatively, if buyers are successful in regaining control. The gold price rally may resume, pushing against the slightly bullish $1,870 50 DMA support. For bulls, the supply zone between $1,858 and 1,860 could be a difficult put to break before that level.

It’s a matter of anticipation for the Federal Reserve.

Markets are looking forward to Powell’s testimony regarding the semi-annual monetary policy report. Which was published on Friday. In order to prepare for a major market response to the Fed Chief’s testimony, they are turning to reposition.

The likelihood of a rate increase of 50 basis points (bps) at the March summit is currently estimated by the markets to be 30%.

Crucial data awaited

The crucial US ISM Services Price Paid Index outperformed forecasts, coming in at 65.6 vs. 64.5 anticipated. On Friday, the US ISM Services PMI softened marginally to 55.1 in February.

Positive data showed increased price inflation, enhancing the argument for larger Federal Reserve rate increases.

Despite the pessimistic predictions, the US dollar struggled to profit on Friday as end-of-week flows came into action. And, put a lot of pressure on the dollar. As a consequence, the price of gold sharply increased to reach its peak level in 2 weeks of over $1,850.

Traders are currently anticipating the United States Factory Orders figures coming later in the North American session. Markets are looking for new trading impetus ahead of the major event risks later in the week.

The price will be influenced by market sentiment, the US Dollar’s movements, and Treasury bond yields in the lack of authoritative US economic statistics.

Seasonally, March is poor for Gold.

Jan and Aug are typically the two best months for gold. The lowest month for gold over the past 25 years. Though, has been March.

Around the start of the month, gold experienced an initial uptick, which was primarily caused by a retracement in the USD and yields. Following a significant repricing of Fed rates.

The future of gold is expected to continue to reflect the trajectory of US interest rates, though. Expectations of a quick Fed hike, particularly – if Fed speakers start to discuss rates at 6%, would probably put more pressure on gold. The typically sluggish month for gold may help this.

Weekly Technical Indicators