XAU/USD traders cash in as Trump set to announce Fed Chair pick
Gold corrected steeply early Friday after failing to hold above the $5,400 nark.
The US Dollar stages a solid comeback but remains poised for a second weekly slide.
Gold, still overbought, looks to test the $5,000 demand zone on an extended correction from record highs.
Gold is seeing a deep correction early Friday, challenging bids near the $5,100 kevel, following intense volatility witnessed on Thursday.
Gold is down nearly 3% so far this Friday, yet on track for the largest monthly advance since January 1980.
The latest corrective pullback could be attributed mainly to a strong comeback staged by the US Dollar across the board. A cocktail of factors emerges as a tailwind to the Greenback, offering a much-needed reprieve.
The Wall Street Journal reported that US President Donald Trump and Senate Democrats struck a deal to avert a government shutdown, lending support to the buck.
Additionally, the Fed’s cautious hold decision and profit-taking following the recent meltdown to four-year lows collaborate to the USD’s resurgence heading into Trump’s announcement of the US Federal Reserve Chair pick due later in the American morning on Friday.The Trump administration is preparing to nominate former Fed Governor Kevin Warsh to be the next Chair, Bloomberg reported on Friday.
Despite the sharp correction in the bright metal, bargain hunting cannot be ruled out as geopolitical risks remain elevated between the US and Iran, while markets digest the latest tariff threats by Trump on Cuba and Canada.
The White House said that Trump signed an executive order that would impose tariffs on countries that provide oil to Cuba, per Reuters.
Looking, Trump’s announcement of his Fed Chair pick and US PPI data are eagerly awaited for the next critical move in Gold.
Daily technical analysis
In the daily chart, XAU/USD trades at $5,195.05. The 21-day SMA rises above the 50- and 100-day, while the 200-day SMA also trends higher. Price holds above these averages, reinforcing a bullish bias. The RSI is at 72.07 (overbought), with momentum still firm. Immediate support is at the 21-day SMA at $4,764.72.
Shorter SMAs remaining stacked above longer ones underscore the prevailing uptrend, with the 50-day SMA at $4,481.84 underpinning the structure. The 100- and 200-day SMAs continue to advance, confirming the broader positive slope. RSI stays elevated, which could cap near-term upside and favor consolidation rather than reversal. Pullbacks would be expected to find support near the 50-day SMA, while sustained trade above the short-term averages keeps the path of least resistance to the upside.
XAU/USD traders cash in as Trump set to announce Fed Chair pick
Gold is seeing a deep correction early Friday, challenging bids near the $5,100 kevel, following intense volatility witnessed on Thursday.
Gold is down nearly 3% so far this Friday, yet on track for the largest monthly advance since January 1980.
The latest corrective pullback could be attributed mainly to a strong comeback staged by the US Dollar across the board. A cocktail of factors emerges as a tailwind to the Greenback, offering a much-needed reprieve.
The Wall Street Journal reported that US President Donald Trump and Senate Democrats struck a deal to avert a government shutdown, lending support to the buck.
Additionally, the Fed’s cautious hold decision and profit-taking following the recent meltdown to four-year lows collaborate to the USD’s resurgence heading into Trump’s announcement of the US Federal Reserve Chair pick due later in the American morning on Friday.The Trump administration is preparing to nominate former Fed Governor Kevin Warsh to be the next Chair, Bloomberg reported on Friday.
Despite the sharp correction in the bright metal, bargain hunting cannot be ruled out as geopolitical risks remain elevated between the US and Iran, while markets digest the latest tariff threats by Trump on Cuba and Canada.
The White House said that Trump signed an executive order that would impose tariffs on countries that provide oil to Cuba, per Reuters.
Looking, Trump’s announcement of his Fed Chair pick and US PPI data are eagerly awaited for the next critical move in Gold.
Daily technical analysis
In the daily chart, XAU/USD trades at $5,195.05. The 21-day SMA rises above the 50- and 100-day, while the 200-day SMA also trends higher. Price holds above these averages, reinforcing a bullish bias. The RSI is at 72.07 (overbought), with momentum still firm. Immediate support is at the 21-day SMA at $4,764.72.
Shorter SMAs remaining stacked above longer ones underscore the prevailing uptrend, with the 50-day SMA at $4,481.84 underpinning the structure. The 100- and 200-day SMAs continue to advance, confirming the broader positive slope. RSI stays elevated, which could cap near-term upside and favor consolidation rather than reversal. Pullbacks would be expected to find support near the 50-day SMA, while sustained trade above the short-term averages keeps the path of least resistance to the upside.
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