Gold Price Analysis: XAU/USD fades bounce off weekly low on firmer US dollar

old fails to increase corrective pullback from a one-week low.
Risk dwindles as covid, stimulus catalysts flash mixed signals.
Powell’s news conference, FOMC statement are going to be the key amid status-quo expectations.
Gold retreats to $1,770, down 0.30% intraday, while heading into the ecu session on Wednesday. The alpha-beta brass bears the burden of a stronger US dollar because it fizzles the bounce off the weekly bottom.

Hopes folks stimulus battle mixed catalysts concerning the coronavirus (COVID-19) and vaccinations to place a bid under the US dollar. Also supporting the greenback might be the market’s cautious sentiment before the US Federal Reserve System (Fed) monetary policy meeting, up for publishing amid late Wednesday.

That said, the US dollar index (DXY) regains the 91.00 thresholds, up 0.15% intraday, during the second consecutive positive day by the press time. It should, however, be noted that the upbeat expectations over US President Joe Biden’s stimulus packages, both already proposed and certain to be tabled today, keeps the S&P 500 Futures mildly bid.

Elsewhere, markets remain jittery as Asia struggles with covid, and doubts over AstraZeneca stay the table despite the US approval usage. Further, expectations that Fed Chair Jerome Powell might not be ready to defend the US central bank’s easy money policies for long also seem to assist the US dollar.

It’s worth mentioning that inaction by the US 10-year Treasures after the longest daily streak in six weeks warrants gold traders to stay cautious before the key event.

Read: Federal Reserve System Preview: Will Powell power up the dollar? Three things to observe out for

Technical analysis
Gold justifies the previous day’s downside break of monthly support amid bearish MACD signals. However, a neighborhood comprising tops marked since March around $1,760–55, becomes the key support.

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