XAU/USD Surrenders Intraday Gains, Focus Remains On FOMC

1. XAU/USD Surrenders Intraday Gains,
Focus Remains On FOMC

2. Points To Be Covered Today:
• XAU/USD Surrenders Intraday Gains
• US Dollar Was Back
• Technical Perspective
• Gold Is Holding Steady
• Gold Bears Await Break Below 100-day
• Gold Has Been Oscillating In A Range
• Gold Price: Key Levels To Watch
• Gold Technical & Fundamental Overview

3. XAU/USD Surrenders Intraday Gains
• Gold extended its range-bound price action through the early
North American session.
• A goodish pickup in the US bond yields benefitted the USD
and capped the early uptick.
• COVID-19 jitters extended some support to the safe-haven
metal ahead of the FOMC.

4. XAU/USD Surrenders Intraday Gains - I
• Gold extended its range-bound price action through the early North American
session.
• A goodish pickup in the US bond yields benefitted the USD and capped the early
uptick.
• COVID-19 jitters extended some support to the safe-haven metal ahead of the
FOMC.
• Gold refreshed daily lows heading into the North American session, albeit quickly
recovered a bit thereafter.
• Currently hovering around the $1,800 mark, the XAU/USD struggled to capitalize
on its modest intraday gains to the $1,807 area and was capped by a combination
of factors.

5. US Dollar Was Back
• The US dollar was back in demand amid a goodish pickup in the US Treasury bond
yields, which, in turn, acted as a headwind for the non-yielding yellow metal.
• The USD uptick could further be attributed to some repositioning trade ahead of the
highly-anticipated FOMC monetary policy decision, scheduled to be announced
later during the US session.
• Market players will look for clues on the timing of tapering amid surging inflation in
the US.
• This will play a key role in influencing the near-term trajectory for the greenback
and provided a fresh directional impetus to the dollar-denominated commodity.

6. US Dollar Was Back - I
• Meanwhile, investors remain worried about the potential economic fallout from
the spread of the highly contagious Delta variant of the coronavirus.
• This, to a larger extent, helped offset the negative factors and helped limit any
meaningful slide for the traditional safe-haven gold.
• Investors also seemed reluctant heading into the FOMC event risk,
warranting some caution before placing any aggressive directional bets.

7. US Dollar Was Back - II

8. Technical Perspective
• Even from a technical perspective, the XAU/USD has been oscillating in a familiar trading
range over the past one week or so.
• The downside remains cushioned near the $1,790 horizontal support, which should now
act as a pivotal point for short-term traders.
• Given the recent failure near the very important 200-day SMA, a convincing break below
might trigger some technical selling and pave the way for some near-term depreciating
move.
• On the upside, the $1,808-10 region now seems to have emerged as immediate strong
resistance.
• A sustained strength beyond is likely to push spot prices back closer to the 200-day SMA,
currently around the $1,822-23 region.
• Some follow-through buying will be seen as a fresh trigger for bullish traders and pave the
way for a move towards monthly swing highs, around the $1,834 area, en-route the next
relevant hurdle near the $1,850-52 zone.

9. Gold Is Holding Steady
• “Gold is holding steady just above the 1791.45 12th July low. It really needs to overcome the
1834.16 mid-July high to regenerate upside interest and at currently levels we are relatively
neutral.”
• “The daily Elliott wave count remains negative and below 1790 will target the 1752 2019-2021
uptrend line.”
• “While above there we will retain our longer term upside bias, however the lack of a sustained
bounce is worrying. Above 1834.16 lies the 1857.25 4th June low. This guards the June high at
1916.91 and Fibo at 1921.”
• “Longer term we still target the 1959/65 November 2020 high and the 2021 high. These guard
the 1989/78.6% retracement and the 2072 2020 peak.”
• “The 78.6% retracement lies at 1728.90 and only below here will target the 1677.73/1676.80
lows seen in March.”

10. Gold Bears Await Break Below 100-day
• Gold price bounce after defending key support around $1798 once again.
• Markets remain cautious ahead of the crucial Fed decision.
• Gold bears await break below 100-day SMA at $1,796.
• Gold maintained its bid tone through the early European session and was last
seen trading near the top end of its daily range, around the $1,805 region.
• The risk-off impulse in the markets – as depicted by a generally negative tone
around the equity markets – continued acting as a tailwind for the safe-haven
precious metal.

11. FOMC Monetary Policy
• Investors remain worried about the potential economic fallout from the fast-
spreading Delta variant of the coronavirus. This, along with China's regulatory
crackdown, further took its toll on the global risk sentiment.
• However, a combination of factors kept a lid on any runaway rally for gold, at least
for the time being. The US dollar was back in demand amid a modest uptick in the
US Treasury bond yields.
• This, in turn, was seen as a key factor that capped gains for the dollar-denominated
commodity. Investors also seemed reluctant to place any aggressive bets ahead of
the key event risk – the conclusion of a two-day FOMC monetary policy meeting.
The outcome will assist market participants to determine the near-term trajectory for
the non-yielding gold.

12. Gold Has Been Oscillating In A Range
• Even from a technical perspective, gold has been oscillating in a range over the past one week or so.
Given the recent failure near the very important 200-day SMA, this further makes it prudent to wait for
strong follow-through buying before positioning for any further appreciating move.
• Previous update: Gold price is rising back above $1800, defending the key support area around $1798
amid a cautious market mood heading into the Fed decision.
• The sell-off in the Chinese stocks seems to have paused, offering some support to the Asian indices,
although surging covid cases in Asia remain a drag on the investors’ sentiment.
• A retreat in the US Treasury yields and the risk-off mood is boding well for gold price. Meanwhile, the US
dollar holds the lower ground amid downbeat US Durable Goods data and pre-Fed repositioning.
• All eyes remain on the Fed decision, as markets bet on a hawkish signal from the world’s most powerful
central bank. The Fed is expected to hint at a likely taper starting off from the final quarter of this year.

13. Gold Price: Key Levels To Watch
• The Technical Confluences Detector shows that gold has managed to defend powerful support
around $1798, which is the convergence of the Fibonacci 61.8% one-day, Fibonacci 23.6% one-
week and SMA100 one-day.
• Acceptance below that level could revive the bearish interests, calling for a test of the previous
day’s low at $1794.
• Further south, the intersection of the previous week’s low and Fibonacci 23.6% one-month at $1791
will be a tough nut to crack for gold bears.
• Alternatively, if the buyers need to find a strong foothold above the key resistance at $1805 to
unleash further upside. That level is the confluence of the previous day’s high and Bollinger Band
one-hour Upper.
• The relevant upside target appears at $1812, where the SMA10 one-day, Fibonacci 61.8% one-
week and the pivot point one-day R2 merge.
• The bulls will then look to take out the Fibonacci 38.2% one-month at $1814.
• Despite the renewed bids, it's going to be a bumpy ride for gold bulls.

14. Here Is How It Looks On The Tool

15. Gold Technical Overview
• Even from a technical perspective, the XAU/USD has been oscillating in a
familiar trading range over the past one week or so.
• The downside remains cushioned near the $1,790 horizontal support, which
should now act as a pivotal point for short-term traders.
• Given the recent failure near the very important 200-day SMA, a convincing
break below might trigger some technical selling and pave the way for some
near-term depreciating move.

16. Gold Technical Overview - I
• On the upside, the $1,808-10 region now seems to have emerged as
immediate strong resistance.
• A sustained strength beyond is likely to push spot prices back closer to the
200-day SMA, currently around the $1,822-23 region.
• Some follow-through buying will be seen as a fresh trigger for bullish traders
and pave the way for a move towards monthly swing highs, around the $1,834
area, en-route the next relevant hurdle near the $1,850-52 zone.

17. Gold Technical Overview - II

18. Gold Fundamental Overview
• Gold refreshed daily lows heading into the North American session, albeit quickly recovered a bit thereafter.
Currently hovering around the $1,800 mark, the XAU/USD struggled to capitalize on its modest intraday gains
to the $1,807 area and was capped by a combination of factors.
• The US dollar was back in demand amid a goodish pickup in the US Treasury bond yields, which, in turn,
acted as a headwind for the non-yielding yellow metal.
• The USD uptick could further be attributed to some repositioning trade ahead of the highly-anticipated
FOMC monetary policy decision, scheduled to be announced later during the US session. Market players
will look for clues on the timing of tapering amid surging inflation in the US.
• This will play a key role in influencing the near-term trajectory for the greenback and provided a fresh
directional impetus to the dollar-denominated commodity.
• Meanwhile, investors remain worried about the potential economic fallout from the spread of the highly
contagious Delta variant of the coronavirus.
• This, to a larger extent, helped offset the negative factors and helped limit any meaningful slide for the
traditional safe-haven gold. Investors also seemed reluctant heading into the FOMC event risk, warranting
some caution before placing any aggressive directional bets.

19. Gold Fundamental Overview - I

20. XAU/USD Surrenders Intraday Gains,
Focus Remains On FOMC

21. Thanks for listening
XAU/USD Surrenders Intraday Gains, Focus Remains On FOMC