Gold Turns Higher As Recovery Picks Pace

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Gold Turns Higher As Recovery Picks Pace

Gold Crosses $1920 As Recovery Picks Pace

The Gold (XAU/USD) didn't exactly start this week on a positive note, as it lost the $910 handle on bearish pressure. However, the 10-year bond yields turned negative and thus rescued the Gold from its daily lows.

The negative pressure in the yields pushed it below the 4.7% level and thus lent much-needed support to the Gold, which is now trading above the $1920 level.

Gold's technical analysis suggests that even if the bearish pressure arises again, the $1900 level will remain an important support level. At the same time, the 100 SMA (d1) is also present near the $900 level, which makes it an important pivot point.

$1868 Remains An Important Support Level

But if the Gold Bears break the $19K level, the next support will be the $1868 level, followed by the $1860 and then the $1850 level.

On the contrary, consistent buying momentum means the Gold (XAU/USD) will touch the $1932 level (high). Since this level is significant, it means a decisive break will be needed before any further advance. The next significant resistance levels that the Gold (XAU/USD) traders need to watch out for are the $1945, $1950, and the $1975.

On Friday, Gold prices touched the $1932 level, which also happened to be a 3-week high for the yellow metal. Although the yellow metal is below its 3-week high, there is still no clear direction as geopolitical tension and the Fed's policy are causing the market to exercise caution.

A bull's scenario is also not that strong, as they failed to sustain a move above the 200 SMA. When this is combined with the US bond yields and the selling orders in the Gold, it suggests that trouble is ahead for the yellow metal.

For any substantial bullish momentum in the Gold, the 200 SMA on the daily will need to be reclaimed once again. But given the macroeconomic condition, that looks like a far-fetched idea in the short term.

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