- Gold regains positive traction and reverses a part of the previous day’s retracement slide.
- Retreating US bond yields prompts some USD profit-taking and benefits the XAU/USD.
- Geopolitical risks and the US political uncertainty contribute to the intraday move up.
Gold price (XAU/USD) attracts some dip-buying during the Asian session on Thursday and stalls the overnight pullback from a fresh record high. The US political uncertainty ahead of the November 5 Presidential election and Middle East tensions turn out to be key factors that continue to act as a tailwind for the safe-haven commodity. Apart from this, retreating US Treasury bond yields prompt some US Dollar (USD) profit-taking and offer additional support to the non-yielding yellow metal.
That said, the prospects for smaller interest rate cuts by the Federal Reserve (Fed) and deficit-spending concerns after the US election should limit any meaningful downfall for the US bond yields. This, in turn, favors the USD bulls, warranting some caution before placing fresh bullish bets around the Gold price and positioning for the resumption of the recent uptrend. Traders now look to the release of the flash PMIs for a fresh insight into the health of the global economy and some impetus.
Daily Digest Market Movers: Gold price benefits from haven flows, retreating US bond yields and softer USD
- The US Dollar and the US Treasury bond yields shot to their highest level in three months, triggering an intraday profit-taking slide in the Gold price on Wednesday.
- The incoming robust US macro data suggested that the economy remains on strong footing and dampened hopes for a more aggressive easing by the Federal Reserve.
- Furthermore, the recent comments from a slew of influential Fed officials suggested the central bank will proceed with modest interest rate cuts over the next year.
- The CME Group’s FedWatch Tool indicates that traders are pricing in over a 90% chance that the Fed will lower borrowing costs by 25 basis points in November.
- Meanwhile, the odds of former President Donald Trump winning the November 5 US Presidential election fuel speculations about the launch of inflation-generating tariffs.
- Investors remain concerned that the spending plans of both Vice President Kamala Harris and the Republican nominee Donald Trump will further increase the deficit.
- The Israeli military carried out air strikes in southern Lebanon and Beirut’s suburbs after Hezbollah fired rockets at two bases near Tel Aviv and west of Haifa.
- This comes on top of the impending Israeli strike against Iran, in retaliation to the latter’s ballistic missile attack on October 1 and lends support to the XAU/USD.
Technical Outlook: Gold price could attract sellers near $2,730-2,732 region, ascending channel support breakpoint
From a technical perspective, the overnight breakdown below a short-term ascending trend-channel support could be seen as a fresh trigger for bearish traders. Moreover, negative oscillators on hourly charts suggest that the path of least resistance for the Gold price is to the downside. That said, it will still be prudent to wait for a convincing break below the $2,700 mark before positioning for any further losses. The XAU/USD might then accelerate the corrective decline towards the $2,685 intermediate support en route to the $2,672-2,670 strong horizontal resistance breakpoint.
On the flip side, the ascending channel support breakpoint, around the $2,730-2,732 area, now seems to act as an immediate hurdle. The next relevant resistance is pegged near the $2,750 region, above which the Gold price could resume its well-established uptrend and climb further towards the $2,770-2,775 zone before aiming to conquer the $2,800 round-figure mark.
US Dollar PRICE Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.09% | -0.04% | -0.27% | -0.11% | -0.16% | -0.15% | -0.01% | |
| EUR | 0.09% | 0.03% | -0.20% | -0.02% | -0.09% | -0.08% | 0.04% | |
| GBP | 0.04% | -0.03% | -0.24% | -0.07% | -0.16% | -0.13% | -0.01% | |
| JPY | 0.27% | 0.20% | 0.24% | 0.19% | 0.12% | 0.09% | 0.25% | |
| CAD | 0.11% | 0.02% | 0.07% | -0.19% | -0.05% | -0.05% | 0.06% | |
| AUD | 0.16% | 0.09% | 0.16% | -0.12% | 0.05% | 0.02% | 0.14% | |
| NZD | 0.15% | 0.08% | 0.13% | -0.09% | 0.05% | -0.02% | 0.11% | |
| CHF | 0.01% | -0.04% | 0.00% | -0.25% | -0.06% | -0.14% | -0.11% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
