FxWirePro: Gold Weekly Outlook
Ichimoku analysis (Weekly chart)
Gold has pared some of its gains due to rising bond yields. The dovish Fed comments have pushed the yellow metal to $1831.The US dollar has declined more than 100 pips the previous week. Any breach below 91.60 confirms further bearishness. Markets eye US Nonfarm payroll and ISM manufacturing and services data for direction. The yellow metal hits an intraday low of $1808.61 and is currently trading around $1810.95
The Fed has kept its rates unchanged as expected and bond-buying for at least by Dec 2021. The central bank has said that "the economy has made progress" toward the goals of maximum employment and price stability". US Gross domestic product surged at an annual rate of 6.3% in the second quarter below the estimated 8.5%. The number of people who have filed for unemployment benefits by 24000 to 400000 last week compared to a forecast of 382000.
Factors to watch for gold price action-
Global stock market- Slightly bullish (negative for gold)
US dollar index – Bearish (positive for gold)
US10-year bond yield- strong (negative for gold)
It is facing strong support at $1790 violation below targets $1780/$1765. Significant trend continuation only below $1675. On the higher side, near-term resistance is around $1821 and a convincing break above will take the yellow metal $1835/$1860/$1900 is possible.
It is good to sell on rallies around $1810-11 with SL around $1825 for TP of $1750.