GOLD on its way to record highs at $3,500 amid thin markets
Gold rises for a fifth consecutive day early Monday, at fresh five-month highs.
The US Dollar turns south again despite risk aversion as trade uncertainty and dovish Fed bets weigh.
Technically, Gold has more room to the upside as the daily RSI holds just beneath the overbought region.
Gold has regained traction early Monday, sitting at the highest levels in five months near $3,480. The US and Canadian markets are closed on Monday due to Labor Day, leaving Gold at the mercy of thin trading conditions.
Gold is seeing a positive start to September, extending its uptrend into a fifth consecutive day, while approaching the record highs of $3,500.
The latest leg north in Gold could be attributed to the revival of safe-haven demand amid the declines across the Asian markets, especially with the Japanese Nikkei 225 index hit hard in the aftermath of Friday’s tech sell-off on Wall Street.
Renewed uncertainty on the trade front adds to the risk-averse market profile. On Friday, a US court ruled that President Donald Trump’s global tariffs, unilaterally imposed, as largely illegal.
Moreover, a surprise jump in the Chinese Caixin Manufacturing PMI for August adds to the renewed Gold price upside.The RatingDog China general Manufacturing Purchasing Managers Index rose to 50.5 last month from 49.5 in July, according to data released Monday by S&P Global, beating the estimated 49.5 readout.
Furthermore, expectations of aggressive US Fed easing in the coming months also power the non-yielding Gold. Markets are pricing in a roughly 90% chance of the Fed lowering interest rates this month, according to the CME Group’s FedWatch Tool.
In line with estimates US Core PCE Price Index – the Fed’s preferred inflation gauge, released on Friday, strengthened the dovish sentiment around the Fed expectations.
Meanwhile, attention turns to a slew of critical US employment data due later this week for fresh signs on the health of the country’s labor market, which is key to determining the scope and the timing of the next Fed rate cuts.
Additionally, speeches by Fed policymakers and trade headlines will also keep Gold traders entertained.
Daily technical analysis
The daily chart shows that Gold has more room to the upside as the 14-day RSI is still beneath the overbought region while comfortably in the bullish zone.
Meanwhile, the 21-day SMA and the 50-day SMA bullish crossover remains in play.
The immediate topside hurdle is seen at the record high of $,3500, above which the $3,550 psychological level will be tested.
On the flip side, any pullback will challenge the intraday of $3,437 initially, below which sellers will attack the $3,400 level.
A sustained break below the latter will expose the 21-day SMA at $3,373.
GOLD on its way to record highs at $3,500 amid thin markets
Gold has regained traction early Monday, sitting at the highest levels in five months near $3,480. The US and Canadian markets are closed on Monday due to Labor Day, leaving Gold at the mercy of thin trading conditions.
Gold is seeing a positive start to September, extending its uptrend into a fifth consecutive day, while approaching the record highs of $3,500.
The latest leg north in Gold could be attributed to the revival of safe-haven demand amid the declines across the Asian markets, especially with the Japanese Nikkei 225 index hit hard in the aftermath of Friday’s tech sell-off on Wall Street.
Renewed uncertainty on the trade front adds to the risk-averse market profile. On Friday, a US court ruled that President Donald Trump’s global tariffs, unilaterally imposed, as largely illegal.
Moreover, a surprise jump in the Chinese Caixin Manufacturing PMI for August adds to the renewed Gold price upside.The RatingDog China general Manufacturing Purchasing Managers Index rose to 50.5 last month from 49.5 in July, according to data released Monday by S&P Global, beating the estimated 49.5 readout.
Furthermore, expectations of aggressive US Fed easing in the coming months also power the non-yielding Gold. Markets are pricing in a roughly 90% chance of the Fed lowering interest rates this month, according to the CME Group’s FedWatch Tool.
In line with estimates US Core PCE Price Index – the Fed’s preferred inflation gauge, released on Friday, strengthened the dovish sentiment around the Fed expectations.
Meanwhile, attention turns to a slew of critical US employment data due later this week for fresh signs on the health of the country’s labor market, which is key to determining the scope and the timing of the next Fed rate cuts.
Additionally, speeches by Fed policymakers and trade headlines will also keep Gold traders entertained.
Daily technical analysis
The daily chart shows that Gold has more room to the upside as the 14-day RSI is still beneath the overbought region while comfortably in the bullish zone.
Meanwhile, the 21-day SMA and the 50-day SMA bullish crossover remains in play.
The immediate topside hurdle is seen at the record high of $,3500, above which the $3,550 psychological level will be tested.
On the flip side, any pullback will challenge the intraday of $3,437 initially, below which sellers will attack the $3,400 level.
A sustained break below the latter will expose the 21-day SMA at $3,373.
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