- XAU /USD keeps its bullish trend line, but the main resistance lies ahead
- Gold has so far gained momentum in September
Gold (XAU / USD) is starting to look a bit feverish again, despite the fact that it managed to rise higher at the end of last week. The retreat of the last two sessions isn’t overstretched yet, and it’s likely to offer better entry opportunities for new buyers, but there’s not much room left before the prospects can be seen.
So far, the upward trend since the XAU / USD reversal in August has been largely intact, with small reversals allowing the other leg to be raised higher. The question now is whether this is another or more reversal of the momentum, especially given how strong the withdrawal has been over the last two days compared to other times.
XAU / USD daily schedule
Market sentiment has so far been quite good-natured, not conducive to demand for safe havens, and as the Fed plans to potentially tighten towards the end of the year, central bank inaction is no longer so strong for those looking for higher returns on non-productive assets such as gold.
Friday’s push is weaker than expected NFP the data showed once again that changes in the price of gold are mostly due to US dollar at the moment, and as there is still room for a stronger currency as yields return to pre-pandemic levels, the outlook for gold does not seem too high in the medium term.
This is also true when the pandemic recovers, with new cases growing rapidly around the world, as the US dollar, regardless of the state of the US economy, may outperform as it increases demand for shelters, outpacing gold as a protective trade.
XAU / USD monthly chart
The turn of the first trading day of September 5 has been quite zero, the non-existent body and small tails show a lack of momentum. August’s candlestick became a clear sign of indecision. The long downward tail showed that the bear’s fall was the opposite, to level it completely by the end of the month, making it harder to make stronger moves in September. So far, XAU / USD has found strong resistance to the 38.2% Fibonacci retracement since its peak in August 2020, an area that has stopped bulls in the last three months. The downside is that 50% Fibonacci (1763) is probably the best area of support for the future.
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– Written by Daniela Sabin Hathorn, Market Analyst
Follow Daniela on Twitter @HathornSabin