The gold price lacks a distinct directional bias, ranging near $1800 in Thursday’s trading band. According to FXStreet’s Dhwani Mehta, Thursday’s Doji keeps sellers hopeful despite the dollar’s comeback.
See DBS Bank’s Gold Price Forecast: Risk-reward favorable for XAU/USD in the run-up to August.
“Gold traders are optimistic that economic headwinds would force central banks to retain an accommodative monetary policy stance for the foreseeable future. However, gold’s additional gains appear to be in jeopardy, as the risk-off market profile is likely to keep haven demand for the US dollar alive, putting downward pressure on the USD-denominated metal.”
“Despite a quiet US docket, markets will continue to draw cues from yield and dollar dynamics. As the week draws to a close, fresh covid developments and the Fed’s Monetary Policy Report could provide some near-term trading chances.”
“A Doji candlestick was noticed in gold the day before, indicating buyer weariness following the recent comeback rise. A Doji candlestick has formed again again in Friday’s trade, supporting the notion that bullish momentum is waning as bears strive for dominance. Furthermore, the 14-Relative Strength Index (RSI) is flat but still below the midline, implying further fall.”
“On the upside, the three-week highs of $1818 will provide stiff resistance, and the somewhat softer 200-DMA at $1827 could be tested.”
“Should the negative pressure get traction, the 21-DMA at $1796 will provide quick support. The horizontal 100-DMA at $1790 is the next key support level. If the latter is broken on a daily basis, the floor could open up for a retest of the two-month lows around $1751.”/n
