Gold Price Forecast: XAU/USD poised to extend slide as long as $1,760 holds

Gold stays notably quiet following Monday’s sharp decline.
XAU/USD may want to stage a technical correction earlier than the subsequent leg down.
A every day shut above $1,760 ought to put gold in a consolidation phase.
Following Friday’s selloff, gold suffered heavy losses at the begin of the week and misplaced greater than 4% in a two-day slide. Although XAU/USD managed to erase a element of its every day losses in the 2d half of of the day on Monday, it is having a tough time extending its recovery. As of writing, the pair was once actually unchanged on the day at $1,730.

The unabated USD power on the again of hawkish Fed commentary and upbeat records releases proceed to pressure gold to continue to be on the again foot.

On Monday, Richmond Fed President Thomas Barking referred to that the Fed has made giant similarly growth towards the taper benchmark. Similarly, Atlanta Fed President Raphael Bostic introduced that he may want to see the Fed decreasing purchases between October and December. Meanwhile, the month-to-month document posted by means of the US Bureau of Labor Statistics printed that the quantity of job openings on the final enterprise day of June reached a new series-high of 10.1 million.

Reflecting the greenback’s sturdy overall performance in opposition to its rivals, the US Dollar Index is staying afloat at its best possible degree in almost three weeks above 93.00.

Later in the session, the Nonfarm Productivity and the Unit Labor Costs information for the 2nd quarter will be featured in the US monetary docket. Moreover, buyers seem to be for clean clues concerning the timing of asset tapering when Cleveland Fed President Loretta Mester and Chicago Fed President Charles Evans talk at 1400 GMT and 1830 GMT, respectively.

More importantly, July Consumer Price Index (CPI) information from the US will be watched intently by way of market members on Friday. Commenting on gold’s latest action, “the gold market would remain touchy to inflation-driven records and US taper talk, so watch out for tomorrow’s US July CPI data,” stated Benjamin Wong, Strategist at DBS Bank.

US July CPI Preview: Inflation records not going to trade Fed tapering expectations.

Gold technical outlook
Key technical stages stay intact on Tuesday as gold fluctuates in a extraordinarily slim range. In the meantime, the Relative Strength Index (RSI) on the day by day chart stays beneath 30, suggesting that XAU/USD should seem to right its oversold prerequisites earlier than pushing lower. The former guide stage at $1,750 now aligns as the preliminary resistance in advance of $1,760 (static level). A day by day shut above the latter should assist XAU/USD go into a consolidation section in the close to term.

On the flip side, $1,730 (static level) is the first goal on the draw back in case XAU/USD comes below renewed bearish pressure. $1,700 (psychological level) aligns as the subsequent key assist in advance of $1,687 (Aug. 9 low).

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