The market action remained subdued on Tuesday as trading conditions started slowly to normalize following the long weekend. As the US Dollar (USD) staged a technical rebound following the dismal performance seen in the last couple of weeks of 2023, XAU/USD closed the day in negative territory.
On Wednesday, the US ISM Manufacturing PMI improved to 47.4 in December from 46.7 in November. Additionally, the number of job openings on the last business day of November stood at 8.79 million, down modestly from 8.85 million in October. Although these data failed to trigger a noticeable market reaction, the USD benefited from risk aversion and caused XAU/USD to continue to push lower. As Wall Street’s main indexes lost about 1% on the day, Gold dropped to its lowest level in nearly two weeks at $2,030.
Private sector employment in the US rose by 164,000 in December and annual pay was up 5.4%, the Automatic Data Processing (ADP) reported on Thursday. The benchmark 10-year US Treasury bond yield climbed above 4% after this data and didn’t allow XAU/USD to stage a meaningful rebound. The probability of the Federal Reserve (Fed) lowering the policy rate by 25 basis points in March declined to 65% on Thursday from 85% earlier in the week following employment-related US data.
On the downside, the 20-day Simple Moving Average (SMA) and the ascending trend line coming from early October form a key support level at $2,040. If Gold falls below this level and fails to reclaim it, $2,020-$2,015 (Fibonacci 23.6% retracement level of the latest uptrend, 50-day SMA) and $2,000 (psychological level, static level) could be set as next bearish targets.
On Wednesday, the US ISM Manufacturing PMI improved to 47.4 in December from 46.7 in November. Additionally, the number of job openings on the last business day of November stood at 8.79 million, down modestly from 8.85 million in October. Although these data failed to trigger a noticeable market reaction, the USD benefited from risk aversion and caused XAU/USD to continue to push lower. As Wall Street’s main indexes lost about 1% on the day, Gold dropped to its lowest level in nearly two weeks at $2,030.
Private sector employment in the US rose by 164,000 in December and annual pay was up 5.4%, the Automatic Data Processing (ADP) reported on Thursday. The benchmark 10-year US Treasury bond yield climbed above 4% after this data and didn’t allow XAU/USD to stage a meaningful rebound. The probability of the Federal Reserve (Fed) lowering the policy rate by 25 basis points in March declined to 65% on Thursday from 85% earlier in the week following employment-related US data.
On the downside, the 20-day Simple Moving Average (SMA) and the ascending trend line coming from early October form a key support level at $2,040. If Gold falls below this level and fails to reclaim it, $2,020-$2,015 (Fibonacci 23.6% retracement level of the latest uptrend, 50-day SMA) and $2,000 (psychological level, static level) could be set as next bearish targets.