- Gold price comes under some selling pressure on Monday and extends Friday’s pullback from the post-NFP swing high.
- The upbeat market mood, along with a modest recovery in the US bond yields, drive flows away from the yellow metal.
- The USD languishes near a multi-week low amid bets that the Fed is done raising rates and should lend some support.
- Geopolitical tensions might further contribute towards limiting any meaningful downfall for the safe-haven XAU/USD.
Gold price (XAU/USD) kicks off the new week on a weaker note and extends Friday’s retracement slide from the $2,004 area or a multi-day high touched in reaction to softer jobs data from the United States (US). The prevalent risk-on environment – as depicted by a strong follow-through rally in the equity markets – is seen as a key factor weighing on the safe-haven precious metal. Apart from this, a modest pickup in the US Treasury bond yields further drag the non-yielding yellow metal closer to the $1,980 level heading into the European session.
The US Dollar (USD), meanwhile, languishes near a six-week low amid expectations that the Federal Reserve (Fed) is done raising interest rates. This should keep a lid on any meaningful upside for the US bond yields and favour the USD bears, which should lend support to the US Dollar-denominated Gold price. Moreover, the risk of a further escalation in the Israel-Hamas conflict should limit losses for the XAU/USD, warranting caution before positioning for any meaningful corrective decline from the YTD peak touched on October 27.
Daily Digest Market Movers: Gold price is pressured by receding safe-haven demand and rebounding US bond yields
- The US Dollar stages a modest recovery from a six-week low touched on Friday and draws support from a goodish pickup in the US Treasury bond yields, which, in turn, is seen weighing on the Gold price.
- Firming expectations that the Federal Reserve will not hike rates again, bolstered by the softer US macro data released on Friday, should keep a lid on any meaningful appreciating move for the Greenback.
- The headline NFP showed that the US economy added 150K jobs in October as compared to 180K estimated and the previous month’s reading was also revised down to 297K from 336K reported originally.
- The US ISM Non-Manufacturing PMI fell to a five-month low level of 51.8 in October from 53.6 the previous month, reaffirming bets that the Fed will maintain the status quo again at the December policy meeting.
- On the geopolitical front, Israel on Sunday rejected growing calls for a ceasefire in Gaza and said that Israeli forces are set to intensify their operations against the Palestinian Islamist group, Hamas.
- Israel’s chief military spokesperson said the military had attacked terrorist targets of Hezbollah in southern Lebanon in response to a missile attack against tanks that killed an Israeli citizen.
- Hezbollah said it responded by firing rockets at the town of Kiryat Shmona in northern Israel and said that it would never tolerate attacks on civilians and its response would be “firm and strong”.
- Lebanon’s militant group chief Hassan Nasrallah said that his Iran-backed group was not afraid of US warships and all options were open for an expansion of the conflict into Lebanon.
Technical Analysis: Gold price needs to find acceptance above the $2,000 mark for bulls to retake control
From a technical perspective, any subsequent downfall below the $1,980 level is likely to find decent support near last week’s swing low, near the $1,970 region. Some follow-through selling will make the Gold price vulnerable to slide further towards the $1,964 area en route to the next relevant support to the $1,954-1,953 zone.
On the flip side, the $2,000 mark could act as an immediate barrier ahead of Friday’s swing high, around the $2,004 area and the YTD peak, around the $2,009 region. A sustained strength beyond the latter has the potential to lift the Gold price further towards the $2,022 resistance zone.
US Dollar price today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | 0.00% | 0.03% | -0.03% | 0.08% | 0.08% | 0.12% | -0.16% | |
| EUR | 0.00% | 0.04% | -0.03% | 0.07% | 0.07% | 0.11% | -0.17% | |
| GBP | -0.03% | -0.03% | -0.07% | 0.04% | 0.04% | 0.07% | -0.20% | |
| CAD | 0.03% | 0.04% | 0.07% | 0.10% | 0.11% | 0.14% | -0.14% | |
| AUD | -0.06% | -0.08% | -0.03% | -0.11% | 0.00% | 0.05% | -0.24% | |
| JPY | -0.08% | -0.07% | -0.27% | -0.09% | 0.00% | 0.03% | -0.25% | |
| NZD | -0.12% | -0.09% | -0.08% | -0.14% | -0.04% | -0.04% | -0.27% | |
| CHF | 0.17% | 0.17% | 0.20% | 0.13% | 0.24% | 0.25% | 0.28% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
