XAU/USD Targets 200-Day SMA At $1,810 As Recovery Continues

1. XAU/USD Targets 200-day SMA
At $1,810 As Recovery Continues

2. Points To Be Covered Today:
• XAU/USD Levels To Watch Above $1,800– Confluence Detector
• Gold Price: Key Levels To Watch
• Here Is How It Looks On The Tool
• XAU/USD Holds Steady Above $1,785 Level, Lacks Follow-Through
• Bullish Flag Breakout In Play For XAU/USD
• Short Term Technical Outlook

3. XAU/USD Levels To Watch Above $1,800–
Confluence Detector
• Gold has surged above $1,800 as the market mood improves.
• The Confluence Detector is showing what the next targets are.
• Bullish flag breakout in play for XAU/USD.
• The Delta COVID-19 variant is wreaking havoc in the US and around the
world.
• However, it may turn into a boon for gold bulls – as it impacts the plans of the
almighty Federal Reserve.
• Officials at the world's most powerful central bank are watching the virus
developments with worry, and are set to delay withdrawal of stimulus.

4. Gold Price: Key Levels To Watch
• The Technical Confluences Detector shows that gold has regained the
powerful resistance now turned support at $1784, which is the intersection of
the Fibonacci 61.8% one-day, SMA10 four-hour and SMA50 one-hour.
• Therefore, the next critical resistance is now seen at the confluence of the
Fibonacci 61.8% one-month and Bollinger Band 15-minutes Upper at $1793.
• The buyers will then target the $1795 supply zone, which is the meeting point
of the previous week’s high, pivot point one-week R1 and SMA200 four- hour.

5. Gold Price: Key Levels To Watch - I
• Acceptance above the latter will clear the path towards the $1800 round
figure, above which the doors will open up for a test of the 1808 resistance.
• That level is the convergence of the Fibonacci 38.2% one-month, pivot point
one-week R2.
• Meanwhile, if the abovementioned crucial resistance turned support at $1784
caves in, then a drop towards $1775 (pivot point one-month S1) is inevitable.
• The confluence of the SMA200 one-hour and Fibonacci 161.8% one-day at
$1772 could be on the sellers’ radar.

6. Here Is How It Looks On The Tool

7. Gold Broke Out Of
• Gold broke out of last week's horizontal range on Monday.
• 200-day SMA forms the next significant resistance at $1,810.
• Broad-based USD weakness is helping XAU/USD gather bullish
momentum at the start of the week.
• The XAU/USD pair fluctuated in a relatively tight range last week
and struggled to make a decisive move in either direction.

8. The US Dollar Index
• With the greenback coming under strong selling pressure at the start of the
week, gold managed to break out of its horizontal range and touched its
highest level in more than two weeks at $1,804.
• As of writing, XAU/USD was up 1.25% on the day at $1,803.
• In the absence of high-tier macroeconomic data releases, improving market
sentiment seems to be making it difficult for the USD to find demand.
• Reflecting the broad-based USD weakness, The US Dollar Index, which
gained 1% last week, is down 0.32% on the day at 93.15.

9. XAU/USD Holds Steady Above $1,785 Level, Lacks
Follow-through
• Gold price holds firmer towards $1800 as the US dollar weakens.
• Risk-on mood downs the safe-haven USD, Fed’s Jackson Hole goes virtual.
• Gold to stay in consolidation ahead of Jackson Hole.
• Gold maintained its bid tone through the first half of the European session,
albeit lacked any strong follow-through buying.

10. Gold Price Holds Firmer
• Currently trading just above the $1,785 region, the repricing of the likely timing
of the Fed's tapering plan pulled the US dollar further away from multi-month
tops touched on Friday.
• This was seen as a key factor that provided a modest lift to dollar-
denominated commodities, including gold.
• Worries that the surge in new COVID-19 cases could lead to a global
economic slowdown forced investors to scale back their expectations that the
Fed will begin tapering its asset purchases sooner.

11. US Treasury Bond Yields
• This, in turn, prompted some USD profit-taking, though a
generally positive tone around the equity markets capped
gains for the safe-haven gold.
• The risk-on impulse in the markets was reinforced by a
goodish pickup in the US Treasury bond yields, which was
seen as another factor that held traders from placing
aggressive bets around the non-yielding yellow metal.

12. XAU/USD
• Investors also seemed reluctant, rather preferred to wait on the sidelines
ahead of the Fed Chair Jerome Powell's speech at the Jackson Hole
Symposium later this week.
• Powell's comments will be closely scrutinized for clues about the Fed's policy
outlook and provide a fresh directional impetus to gold.
• This might further collaborate to cap gains for the XAU/USD, making it
prudent to wait for some strong follow-through buying before positioning for
any further appreciating move.

13. Gold Is Holding The Higher Ground
• Gold is holding the higher ground, attempting another run towards
the $1800 mark heading into the all-important Fed’s Jackson Hole
Symposium this week.
• The risk-on-market mood remains the main underlying theme
starting out a fresh week, weighing on the safe-haven US dollar.
• Investors take note of the Fed event going virtual, which temper the
tapering expectations bolstered by the FOMC minutes.

14. Covid Variant
• Meanwhile, the looming Delta covid variant threat on the global
economic recovery lifts the yellow metal’s safe-haven appeal.
• Ahead of the Jackson Hole Symposium, gold price will continue to
track the US dollar price action and the broader market
sentiment for fresh trading impetus. Key US macro data will also
draw attention for fresh gold trades.

15. Bullish Flag Breakout In Play For XAU/USD
• Worries about the fast-spreading Delta variant of the coronavirus underpinned the
safe-haven gold.
• A modest USD pullback from multi-month tops provided an additional boost to the
precious metal.
• The market focus now shifts to Fed Chair Jerome Powell’s speech at the Jackson
Hole Symposium.
• A combination of diverging forces failed to provide any meaningful impetus
to gold and led to a subdued/range-bound price action on the last day of the week.
• Firming expectations that the Fed will begin reducing the pace of its massive asset
purchases later this year turned out to be a key factor that acted as a headwind for
the non-yielding yellow metal.

16. FOMC Meeting Minutes
• The FOMC meeting minutes released last Wednesday now seem to have
convinced investors that the Fed is comfortable to roll back its pandemic-era
stimulus.
• Policymakers thought that the benchmark of substantial further progress
criterion has been met in terms of inflation and maximum employment.
• However, the uncertainties tied to the COVID-19 situation extended some
support to the safe-haven precious metal.
• Investors remain worried about the potential economic fallout from the fast-
spreading Delta variant of the coronavirus.

17. Fed’s Tapering
• Moreover, the current surge in new infections might have forced the market to
probably reassess the timing of the Fed's tapering.
• This, in turn, prompted some US dollar profit-taking from a nine-and-half-
month high and further underpinned the dollar-denominated commodity.
• Nevertheless, the XAU/USD managed to eke out modest gains for the second
successive week and gained some traction during the Asian session on
Monday.

18. Trading Opportunities
• The uptick was further supported by weaker PMI prints from Japan and Australia.
• That said, a generally positive tone around the equity markets kept a lid on any
runaway rally for the commodity.
• Investors might also refrain from placing any aggressive bets, rather prefer to wait
on the sidelines ahead of Fed Chair Jerome Powell's speech at the Jackson Hole
symposium.
• In the meantime, the flash version of PMI prints from the Eurozone and the US
would be closely watched to gauge sentiments.
• This, along with the USD price dynamics, might play a key role in influencing the
commodity and produce some meaningful trading opportunities on Monday.

19. Short Term Technical Outlook
• Looking at the technical picture, bulls are now looking to build on the
momentum beyond a resistance marked by the top end of a one-week-old
descending channel on the 1-hour chart.
• Against the backdrop of a strong rebound from multi-month lows, the
mentioned channel constitutes the formation of a bullish flag pattern.
• Moreover, technical indicators on the daily chart have recovered fully from
the negative territory. This, in turn, adds credence to the constructive set-up
and supports prospects for a further near-term appreciating move.

20. XAU/USD Targets 200-day SMA
At $1,810 As Recovery Continues

21. Thanks for listening
XAU/USD Targets 200-day SMA At $1,810 As Recovery Continues