The gold price on Wednesday bounced off the current 2-week lows of about $1,794 to trade above $1,800 amid increased off-risk trading. The price of the yellow metal continues to trade within a descending channel formation in the 60-min chart.
Wednesday’s rebound pushed the gold price off oversold conditions in the 14-hour RSI back to the normal trading zone. The XAU/USD still remains several levels below the 100-hour moving average.
Gold Price Fundamentals Overview
From a fundamental perspective, the yellow metal is trading at a relatively busy period in the global financial markets. The delta variant of covid-19 is causing concerns in the market amid the rising number of cases. This has affected global stock markets including the price of gold. However, on Wednesday, a slight shift towards off-risk trading pushed the gold price higher.
The gold price could also gain significantly in the coming days depending on the performance of the US economy. Earlier this week, US building permits for June missed the expected (MoM) count of 1.7 million with 1.598 million. On the other hand, housing starts for the period outperformed 1.59 million with 1.643 million.
Looking forward, investors will be anticipating Thursday’s initial jobless claims for last week and the Chicago Fed National Activity index. Later in the week, the Markit Manufacturing and Services PMIs will also affect the XAU/USD.
Gold Price Technical Analysis (the 60-min Chart)
Technically, the XAU/USD appears to be trading within a descending channel formation in the 60-min chart. The gold price bounced on Wednesday to avoid crossing to oversold levels of the 14-hour RSI.
The bulls will be looking to ride the current rebound by targeting profits at around $1,811, or higher at $1,818. On the other hand, the bears will target short-term profits at around $1,794 or lower at $1,784.
Gold Price Technical Analysis (the Daily Chart)
In the daily chart, the XAU/USD appears to be pulling back after attempting a rebound. Gold also appears to have found support from the 100-day moving average following this week’s decline. This could trigger the next rebound.
The bulls will be targeting long-term profits at around $1,833 or higher at $1,872. On the other hand, the bears will look to extend the current pullback towards $1,767 or lower to $1,728.