Ichimoku Analysis (4-hour chart)
Tenken-Sen- $1920.58
Kijun-Sen- $1912.03
Gold prices showed a minor pullback on short covering. The yellow metal was poorly performed in the past two months on hawkish rate hikes by major central banks. It hits a high of $1930.76 and currently trading around $1928.90.
US ISM manufacturing PMI declined in June to 46, compared to a forecast of 47.20 expected (Positive for gold).
US dollar index- weak. Minor support around 101.80/101. The near-term resistance is 103.60/104.40.
According to the CME Fed watch tool, the probability of a 25 bpbs rate hike in July increased to 87.40% from 76.90% a week ago.
The US 10-year yield pared some of its gains on weak US ISM manufacturing PMI. The US 10 and 2-year spread widened to -108.50% from -94.8%.
Factors to watch for gold price action-
Global stock market- bullish (negative for gold)
US dollar index - mixed (neutral for gold)
US10-year bond yield- Bullish (Bearish for gold)
Technical:
The near–term support is around $1890, a break below targets of $1878/$1868/$1850.The yellow metal faces minor resistance around $1930; a breach above will take it to the next level of $1936/$1942/$1950/$1955.
It is good to sell on rallies around $1928-30 with SL around $1950 for TP of $1878.
