OctaFX | OctaFX Forex Broker
Open trading account
Back

Gold: recovery limited by $1270, drops to test yesterday’s low

  • Bearish tone prevails as USD strengthens.
  • Price near $1260, testing yesterday’s low. 

Gold turned to the downside during the US session amid a rally of the US dollar across the board. The metal approached yesterday’s low. It bottomed at $1,262.50/oz and it was hovering near the lows, holding a bearish tone. 

At the same time, the greenback gained strength. The Dollar Index reached at 93.56, the highest level in two weeks. The DXY is consolidating on top of the 93.35 area that capped the upside several times during the last two weeks. 

The greenback has been moving with a bullish tone since the beginning of the week. Today’s ADP report offered support to the outlook by confirming that the US labor market remains solid. showed that the private sector added 190K jobs in November, in line with expectations. 

On the flip side, the bearish tone in gold prevails and the pressure could increase with a slide below $1260. The main risks from a fundamental perspective are rising tensions with North Korea, new developments with the Russian interference in 2016 elections and problems with the tax reform at the US Congress. 

XAU/USD Levels to watch 

The metal is testing the $1260 area that is critical. A break lower would see the lowest price since early August and would clear the way for $1250, the next strong support. If it manages to hold above $1260 it could build a base for a recovery. The immediate resistance might be seen at $1270 (Nov 30, Dec 4 low), followed by $1277 (Dec 4, 5 high) and $1285 (Nov 30). 
 

NZD/USD on the verge of a break down to May 2016 lows?

NZD/USD has started to stabalise at the 0.6880 support level as the dollar firms up in the NY session on the back of inline ADP as a solid preview for
Read more Previous

Australia: Q3 GDP  points to continued expansion of the economy - Wells Fargo

Analysts from Wells Fargo, explained that yearly GDP growth in Australia picked up in the third quarter but was a bit below market expectations...
Read more Next
Start livechat