Gold (XAU/USD) witnessed good two-way price movements and settled almost changed at $1869 on Thursday. According to FXStreet’s Dhwani Mehta, gold bears are set to retain control below the 21-DMA at $1876 while the focus shifts to the US Markit PMI and President Biden’s speech.
“Heading into the weekend, the correction in gold will likely to continue, as markets rethink whether the massive US fiscal stimulus could help stimulate the economic recovery.”
“The main drivers remain the US Markit Preliminary Manufacturing PMI and President Joe Biden’s speech for fresh direction on the prices. Biden is due to speak on his administration’s response to the economic crisis.”
“A breach of the $1859 50-DMA support could expose the 200-DMA cap at $1848. The next relevant support awaits at $1832, the January 20 low.”
“A firm break above the $1876 21-DMA barrier is needed for a test of the horizontal 100-DMA at $1883. However, the path of least resistance appears to the downside so long as the XAU bulls hold below the 21-DMA.”