Gold Remains Depressed Despite Favorable Market Conditions

Gold Remains Depressed Despite Favorable Market Conditions

Gold (XAU/USD) prices saw a healthy surge in the early North American session today but failed to continue on that path and retraced, erasing all of its daily gains. At press time, gold is trading at $2,022, after recording a daily high of $2,049.

Much like the US dollar, the yellow metal appears to not have any bearing at the moment despite escalating diplomatic tensions between the US and China. The developments over the weekend coupled with the arrest of Jimmy Lai, Under the National Security Law did little to influence the price action of gold or the markets at large. Market participants are now awaiting ‘definition’ from Washington and further developments regarding the stimulus package.

Meanwhile, some analysts at CitiBank have expressed their optimism about gold’s price trajectory in the near-term. They explained that their short-term target had been moved up to $2,100/oz and that $2,300 seemed achievable. The analysts cited the record pace of ETF investor inflows, the weakening US dollar, and negative yields as the primary factors that could favor gold to push higher.

XAUUSD – Hourly Chart

Gold (XAU) Value Forecast — August 10

XAU/USD Major Bias: Sideways

Supply Levels: $2,035, $2,050, and $2,075

Demand Levels: $2,025, $2,010, and $2,000

Gold has now failed to record a new all-time high for the first time in a week despite the primary trend leaning towards the upside. The current correction appears to be long overdue, yet no significant changes are occurring. In the near-term, we’re likely to see the $2,010 support and possibly the $2,000. A continuation from that level could send us straight to the $1,980 level before a bounce will be seen.

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