Gold prices rebounded during the Asian session on Monday, breaking a two-day losing streak. Weaker-than-expected US employment reports have raised expectations of a September rate cut by the US Federal Reserve (Fed), causing the US Dollar (USD) to weaken and boosting demand for USD-denominated gold. Lower interest rates reduce the opportunity cost of investing in gold, potentially leading to increased demand and higher prices.
However, easing fears of geopolitical tensions in the Middle East, especially regarding the Iran-Israel conflict, coupled with a risk-on sentiment in the market, could dampen demand for safe-haven assets like gold and limit its upside potential. Traders are closely monitoring speeches by Fed officials this week, particularly from Thomas Barkin and John Williams, as any dovish messages could further bolster gold prices.
From a technical standpoint, gold prices remain within a descending trend channel in the short term. Despite this, the precious metal maintains a bullish outlook, trading above the key 100-day Exponential Moving Average (EMA) on the daily chart. The 14-day Relative Strength Index (RSI) indicates market indecisiveness, hovering around the 50 midline.
In the near term, the first resistance for gold lies near the 100-EMA at $2,318. A clear break above this level could signal a continuation of the positive trend, with further resistance around the $2,350–$2,355 region, where a high from April 26 and the upper boundary of the descending trend channel coincide. A breakout above this level may lead gold towards the $2,400 mark and potentially reach its all-time high near $2,432.
Conversely, if selling pressure persists, gold could find support at the psychological level of $2,300, followed by a low from May 3 and the lower limit of the descending trend channel at $2,275. Further downside support levels include a low from April 1 at $2,228 and the round mark of $2,200.
US Dollar price today
The US dollar's (USD) percentage change compared to a list of major currencies is displayed in the table below. The US dollar underperformed the euro the most.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | -0.05% | -0.02% | -0.03% | -0.02% | 0.28% | 0.18% | 0.03% | |
| EUR | 0.04% | 0.02% | 0.02% | 0.03% | 0.31% | 0.22% | 0.07% | |
| GBP | 0.00% | -0.02% | -0.01% | -0.01% | 0.28% | 0.20% | 0.04% | |
| CAD | 0.04% | -0.01% | 0.01% | 0.02% | 0.32% | 0.21% | 0.06% | |
| AUD | 0.03% | -0.01% | 0.02% | 0.01% | 0.31% | 0.21% | 0.07% | |
| JPY | -0.28% | -0.30% | -0.27% | -0.29% | -0.26% | -0.05% | -0.25% | |
| NZD | -0.17% | -0.22% | -0.20% | -0.21% | -0.21% | 0.10% | -0.15% | |
| CHF | -0.04% | -0.06% | -0.05% | -0.06% | -0.04% | 0.26% | 0.15% |
Paraphrasing text from "FX Street" all rights reserved by the original author.
