Gold price struggles to capitalize on its gains recorded over the past two sessions and seesaws between tepid gains/minor losses on Wednesday. The XAU/USD holds steady around the $2,000 psychological mark through the first half of the European session and is influenced by a combination of diverging forces. Fundamental backdrop makes it prudent to wait for strong follow-through buying before confirming that the Gold price has formed a near-term bottom around the $1,970 area and positioning for any further gains.

From a technical perspective, any subsequent move up is likely to confront stiff resistance near the $2,010 area. A sustained move beyond might trigger a fresh bout of a short-covering and lift Gold price beyond the $2,020 hurdle, towards the $2,040 horizontal zone en route to the YTD peak, around the $2,047-$2,049 region. However, the bearish MACD signals and steady RSI teases XAU/USD sellers.

On the flip side, the $1,980 level, followed by the $1,969 region might continue to act as immediate support levels. Some follow-through selling will be seen as a fresh trigger for bearish traders and drag Gold price towards the next relevant support near the $1,956-$1,955 area. The XAU/USD could eventually drop to the monthly low around the $1,950 region.

Also suggesting the Gold price downside is the 200-Hour Moving Average (HMA), around $1,998 by the press time. Meanwhile, the 100-HMA level of $1,990 acts as immediate support for the XAU/USD ahead of the $1,977 level. Overall, the Gold price remains sidelined but the lack of upside momentum and multiple barriers toward the north lures bears of late.

Gold seems prudent towards further hawkish momentum

Apr 26 2023