Gold struggles near 2-week lows, $1400 mark remains in sight

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Gold struggles near 2-week lows, $1400 mark remains in sight

  • The Fed’s hawkish rate cut exerts some heavy bearish pressure on Wednesday.
  • The ongoing USD bullish run further collaborates to the prevalent selling bias.
  • Deteriorating global risk sentiment lends some support and might help limit losses.

Gold dropped to over two-week lows on Thursday, with bears now eyeing a move towards challenging the key $1400 psychological mark.

The precious metal remained under some selling pressure for the second consecutive session on Thursday and added to the previous session’s heavy losses, which came after the Fed lowered its benchmark interest rate by 25 bps but signaled that more rate cuts are not guaranteed.

In the post-meeting press conference, the Fed Chair Jerome Powell described the rate cut as a mid-cycle adjustment of policy and said that the move does not necessarily mean the beginning of a series of rate cuts and prompted some aggressive selling around the non-yielding yellow metal.

Meanwhile, the Fed’s hawkish cut triggered a fresh leg of an upsurge in the US Dollar, which extended through the early European session on Thursday and further collaborated towards driving flows away from the dollar-denominated commodity.

However, given the fact that the US-China trade negotiations concluded without a major breakthrough, a slight deterioration in the global risk sentiment extended some support to the precious metal’s safe-haven status and might turn out to be the only factors that might help limit deeper losses.

Moving ahead, Thursday’s US economic docket – highlighting the release of ISM manufacturing PMI, will now be looked upon for some short-term trading impetus later during the early North-American session and ahead of Friday’s closely watched US monthly jobs report (NFP).

Technical levels to watch

XAU/USD

Overview
Today last price 1406.74
Today Daily Change -6.26
Today Daily Change % -0.44
Today daily open 1413
Trends
Daily SMA20 1416.93
Daily SMA50 1375.99
Daily SMA100 1333.13
Daily SMA200 1301.09
Levels
Previous Daily High 1432.88
Previous Daily Low 1410.7
Previous Weekly High 1433.6
Previous Weekly Low 1411.26
Previous Monthly High 1452.72
Previous Monthly Low 1382.02
Daily Fibonacci 38.2% 1419.17
Daily Fibonacci 61.8% 1424.41
Daily Pivot Point S1 1404.84
Daily Pivot Point S2 1396.68
Daily Pivot Point S3 1382.66
Daily Pivot Point R1 1427.02
Daily Pivot Point R2 1441.04
Daily Pivot Point R3 1449.2
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