Key Highlights
- Gold price rallied further above the $1,550 and $1,600 resistance levels against the US Dollar.
- There was a break above a crucial bearish trend line with resistance near $1,480 on the daily chart of XAU/USD.
- The US ADP Employment increased 202K in Dec 2019, more than the 160K forecast.
- The US Initial Jobless Claims for the week ending Jan 04, 2020 could decline from 222K to 220K.
Gold Price Technical Analysis
In the past few days, gold price remained in a strong uptrend due to the ongoing tensions between the USA and Iran. The price surged above the $1,550 and $1,600 resistance levels.
The daily chart of XAU/USD indicates that the price broke many hurdles near $1,480 and $1,500 to start the current uptrend. Moreover, there was a break above a crucial bearish trend line with resistance near $1,480.
The price settled above the $1,535 resistance, the 100-day simple moving average (red), and the 200-day simple moving average (green).
Finally, there was a spike above the $1,600 level and a new yearly high was formed near $1,611 and the price recently corrected lower. However, the price is finding bids near $1,570 area.
On the downside, there are many supports near the $1,555 and $1,540 levels. The main support is near the $1,535 level since it is the 50% Fib retracement level of the upward move from the $1,458 low to $1,611 high.
On the upside, the $1,585 and $1,600 levels are initial hurdles, above which gold price is likely to climb to a new yearly high.
Fundamentally, the US Employment Change figure for Dec 2019 was released by the Automatic Data Processing, Inc. The market was looking for an increase of 160K in Dec 2019.
The actual result was better than the forecast, the private sector employment increased by 202,000 jobs from November to December 2019.
Overall, gold price might correct lower, but dips remain well supported near $1,555 and $1,535. Looking at EUR/USD, the pair declined below the 1.1150 support area, with a bearish angle. Besides, GBP/USD is struggling to clear the 1.3200 resistance area.
Economic Releases to Watch Today
- Euro Zone Unemployment Rate for Nov 2019 – Forecast 7.5%, versus 7.5% previous.
- US Initial Jobless Claims – Forecast 220K, versus 222K previous.
