GOLD retreats but bullish potential remains intact
Gold price pulls back from two-week highs early Monday.
The US Dollar ignores Trump’s extension of EU tariff deadline as fiscal concerns haunt.
Gold price runs into stiff resistance at $3,364; RSI stays bullish on the daily chart.
Gold price is on a tepid retreat from two-week highs of $3,365 hit on Friday as buyers take a breather amid holiday-thinned conditions on Monday.
US President Trump’s walking back on his earlier threat of a 50% tariff on the EU from June 1 and announcing a July 9 deadline extension fails to provide any respite for the USD
The Greenback refreshes multi-week lows against its major currency rivals, with the DXY losing about 0.40% on the day to trade near 98.70, as of writing.Despite the sustained US Dollar weakness, Gold price has come under renewed selling pressure as markets weigh in a likely trade deal between the US and Japan by mid-June.
Japanese Prime Minister Shigeru Ishiba said on Sunday that he aims to achieve a trade agreement with the US during the Group of Seven (G7) Summit on June 15.However, any downside in Gold price appears limited as looming US fiscal concerns and escalating geopolitical tensions will continue to power safe-haven demand for the bright metal.
Ukrainian President Volodymyr Zelenskyy stated early Sunday that Russian missiles and drones hit more than 30 cities and villages across Ukraine and urged Western partners to ramp up sanctions on Russia. Meanwhile, Iranian Foreign Minister Abbas Araghchi said last week that discussions with the US over its nuclear program were ‘complicated’ as the fifth round of talks concluded in Rome.
Last week, the US House of Representatives passed Trump’s expansive tax and spending bill, which is expected to widen the nation’s $36 trillion national debt.
Markets also remain wary of Trump’s latest tariff threats targeting Apple Inc. Trump warned Apple on Friday that he would impose a 25% import tax “at least” on iPhones not manufactured in America, later widening the threat to any smartphone.
In the day ahead, Gold price could see a limited pullback but light trading conditions could exaggerate moves as the US markets are closed on Monday, in observance of Memorial Day.A mild profit-booking decline cannot be ruled out though as traders gear up for the US inflation data due later this week. Trade headlines will continue to drive the Gold price action.
Daily technical analysis
Technically, Gold price remains exposed to further upside as the 14-day RSI holds comfortable above the midline, near 57, despite the latest downtick.
If buyers fight back control, a sustained break above the falling trendline resistance at $3,364 is needed to resume the ongoing uptrend.The next topside barriers are aligned at $3,400 (round level) and $3,435 (static resistance).
On the downside, strong support is seen near $3,295, which is the confluence of the 21-day SMA and the 38.2% Fibo level of the April record rally.If the corrective move intensifies, a test of the 50% Fibo support at $3,232 will be inevitable, below which the 50-day SMA at $3,207 will come into play.
GOLD retreats but bullish potential remains intact
Gold price is on a tepid retreat from two-week highs of $3,365 hit on Friday as buyers take a breather amid holiday-thinned conditions on Monday.
US President Trump’s walking back on his earlier threat of a 50% tariff on the EU from June 1 and announcing a July 9 deadline extension fails to provide any respite for the USD
The Greenback refreshes multi-week lows against its major currency rivals, with the DXY losing about 0.40% on the day to trade near 98.70, as of writing.Despite the sustained US Dollar weakness, Gold price has come under renewed selling pressure as markets weigh in a likely trade deal between the US and Japan by mid-June.
Japanese Prime Minister Shigeru Ishiba said on Sunday that he aims to achieve a trade agreement with the US during the Group of Seven (G7) Summit on June 15.However, any downside in Gold price appears limited as looming US fiscal concerns and escalating geopolitical tensions will continue to power safe-haven demand for the bright metal.
Ukrainian President Volodymyr Zelenskyy stated early Sunday that Russian missiles and drones hit more than 30 cities and villages across Ukraine and urged Western partners to ramp up sanctions on Russia. Meanwhile, Iranian Foreign Minister Abbas Araghchi said last week that discussions with the US over its nuclear program were ‘complicated’ as the fifth round of talks concluded in Rome.
Last week, the US House of Representatives passed Trump’s expansive tax and spending bill, which is expected to widen the nation’s $36 trillion national debt.
Markets also remain wary of Trump’s latest tariff threats targeting Apple Inc. Trump warned Apple on Friday that he would impose a 25% import tax “at least” on iPhones not manufactured in America, later widening the threat to any smartphone.
In the day ahead, Gold price could see a limited pullback but light trading conditions could exaggerate moves as the US markets are closed on Monday, in observance of Memorial Day.A mild profit-booking decline cannot be ruled out though as traders gear up for the US inflation data due later this week. Trade headlines will continue to drive the Gold price action.
Daily technical analysis
Technically, Gold price remains exposed to further upside as the 14-day RSI holds comfortable above the midline, near 57, despite the latest downtick.
If buyers fight back control, a sustained break above the falling trendline resistance at $3,364 is needed to resume the ongoing uptrend.The next topside barriers are aligned at $3,400 (round level) and $3,435 (static resistance).
On the downside, strong support is seen near $3,295, which is the confluence of the 21-day SMA and the 38.2% Fibo level of the April record rally.If the corrective move intensifies, a test of the 50% Fibo support at $3,232 will be inevitable, below which the 50-day SMA at $3,207 will come into play.
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