Gold price attracts some buyers near the $1,900 mark on Thursday and stalls a three-day-old downtrend from its highest level since April 25. The intraday uptick pushes the XAU/USD to a fresh daily peak, around the $1,916-$1,917 region.

After the Bank of Japan's (BoJ) inaction triggered a massive sell-off in global yields, the US Treasury bond yields continue to remain on thin ice, with the two-year United States Treasury yields falling to the lowest level since October 2022.  Disappointing United States Retail Sales, Producer Price Index (PPI) and Industrial Production data reignited concerns over the health of the US economy, reviving expectations of a potential recession later this year.

On the other side, the safe-haven US Dollar recovered swiftly on a renewed flight to safety but the further upside appears elusive should the US Treasury bond yields sell-off gather steam.

Gold price extends its trade within a pennant on the four-hour chart, with bulls continuing to guard the downside near the lower boundary of the formation at $1,897. At that point, the bullish 50-Simple Moving Average (SMA) emerges, making it a strong support.

Meanwhile, the immediate upside remains capped by the mildly bearish 21SMA at $1,913. The Relative Strength Index (RSI) is inching higher above the midline, having briefly dipped below the latter in the early European trading a day before.

Four-hourly candlestick close above the 21SMA hurdle will drive the recovery further toward the upper boundary of the pennant, aligned at $1,925. However, Gold buyers need to find a strong foothold above the $1,920 round level, at first.

On the downside, if sellers extend their control below the abovementioned key support, a sharp drop toward the $1,870 intermittent cap cannot be ruled out. Deeper declines will call for a test of the ascending 100SMA at $1,854.

Long Term Target : 2070 - Short Term Target : H4 and DEMAs

Jan 19 2023