The prices of precious metal (Gold) began consolidating over the night as US 10-year Treasury yields hit the bottom following a new milestone recorded by S&P 500. At the point when gains on US fixed-income assets decline, the anti-fiat yellow metal is able to profit sometimes. Last week, the master plan for gold demonstrated this transition to be a momentum gathering in a wider range in the wake of bouncing from the low at 1,675 for the third time this year.
In the next 24 hours, there is an array of potential bearish and bullish events as well as Fedspeak. It begins with US retail deals and industrial production before Powell’s online town hall discussion with tutors and students from all over the country.
We do not have any knowledge as to whether Powell will offer any remarks toward Fed tightening in these discussions. Later on Wednesday, the market will be taking a circumspect look at the language in the minutes of the Federal Open Market Committee’s report for advice on Fed tightening plans.
XAU/USD- Chart on Daily Timeframe Image Source: TradingView
GOLD PRICE – TECHNICAL ANALYSIS
Represented in the daily gold chart below, we have the arrangement for the consolidation phase that the market is presently in, with a rebound off the low nearly at 1,675. In spite of this rebound, gold is yet to break out from relevant opposition regions as it moves toward a few upside regions relevance with the 100 and 200-day SMA separately coming in at 1,806 and 1,812. Moreover, the latest previous high comes in at 1,834, giving gold bulls further hurdles to cross over.
Four days ago, XAU/USD seemed to have affirmed a bullish Morning Star candle pattern on the daily chart. That indicated further gains to come in the coming meetings. As of then, we reminded you that a negative ‘Death Cross’ was still occurring between the 20-and 50-day Simple Moving Averages (SMAs). These could shift focus to the downside as key opposition points.
GOLD SENTIMENT ANALYSIS- August 13, 2021
Similarly, as per IG Client Sentiment (IGCS), we reported that about 72% of retail brokers were net-long gold. Uptrend exposure had diminished by 1.55% and 7.15% over daily and weekly premise. Then, we took an opposed view to the herd mentality. Traders were net-long such that it was indicated that prices were likely to decline. On the contrary, we warned that the recent adjustments in sentiment signified a likely reversal in price action.