Gold Price Analysis: XAU/USD renews 5-day lows, drops below $1,710

  • Gold starts the week on the back foot, loses more than 1%.
  • Global equity indexes post heavy losses on Monday.
  • US Dollar Index rises for the third straight day.

The XAU/USD pair started the new week on the back foot and dropped to a fresh five-day low off $1,708. Although the pair recovered slightly, it’s still losing 1.15% on the day at $1,711.

Last week, the troy ounce of the precious metal capitalized on risk-off flows and gained more than $40. Although the market mood remains sour on Monday, XAU/USD is struggling to preserve its bullish momentum on broad-based USD strength.

DXY extends recovery into a third straight day

Following the sharp drop witnessed during the first half of the previous week, the US Dollar Index (DXY) staged a decisive rebound amid heightened worries over a second coronavirus wave hitting the US economy. After ending the week in the positive territory, the index is stretching higher on Monday, causing the bearish pressure on XAU/USD to remain intact. At the moment, the DXY is up 0.12% on the day at 97.20.

Meanwhile, the data from China are weighing on market sentiment on Monday. Retail Sales in May declined by 2.8% on a yearly basis to come in worse than the market expectation for a fall of 2%. Additionally, Industrial Production during that period rose by 4.4%, again missing analysts’ estimate of 5%.

In the second half of the day, the Federal Reserve Bank of New York’s Empire State Manufacturing Survey will be looked upon for fresh impetus. More importantly, investors will be keeping a close eye on Wall Street’s performance. As of writing, the S&P 500 futures were down 1.8% on the day, suggesting that major equity indexes in the US are likely to open deep in the negative territory.

Technical levels to watch for

XAU/USD

OVERVIEW
Today last price 1711.54
Today Daily Change -19.04
Today Daily Change % -1.10
Today daily open 1730.58
TRENDS
Daily SMA20 1722.94
Daily SMA50 1709.03
Daily SMA100 1650.5
Daily SMA200 1574.29
LEVELS
Previous Daily High 1743.09
Previous Daily Low 1722.44
Previous Weekly High 1744.75
Previous Weekly Low 1677.73
Previous Monthly High 1765.38
Previous Monthly Low 1670.72
Daily Fibonacci 38.2% 1735.2
Daily Fibonacci 61.8% 1730.33
Daily Pivot Point S1 1720.98
Daily Pivot Point S2 1711.39
Daily Pivot Point S3 1700.33
Daily Pivot Point R1 1741.63
Daily Pivot Point R2 1752.69
Daily Pivot Point R3 1762.28

 

 



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