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Gold (XAU/USD) maintained its bearish tone through the early European session on Wednesday and was last spotted trading around the $1845 area. The bearish momentum was solely sponsored by a goodish uptick in the US dollar, which tends to undermine demand for the dollar-denominated commodity.
Gold Price Analysis — January 30
The greenback saw a fresh influx of demand amid doubts over the timing and size of the newly proposed US stimulus bill. That said, the prevalent cautious mood surrounding the equity markets has capped further declines for the precious metal in the meantime.
Market mood is currently being suppressed by the growing worries over an economic fallout from the COVID-19 pandemic and the escalating US-China tensions in the South China Sea.
Meanwhile, the lower risk appetite bolstered a softer tone around the US Treasury bond yields, which extended additional support to the non-yielding metal. Also, market participants appear to be avoiding placing aggressive bets ahead of the FOMC monetary policy decision scheduled for release later today. This event, coupled with the release of US Durable Goods Orders data and developments surrounding the coronavirus pandemic, will be looked upon for market clues today.
This makes it advisable to wait for a sustained move to the downside before placing aggressive bets.
Gold (XAU) Value Forecast — January 30
XAU/USD Major Bias:Sideways
Supply Levels:$1860, $1875, and $1890
Demand Levels:$1838, $1827, and $1818
Gold has traded on a directionless bias over the past few days, following several failed attempts to reclaim dominance above the $1875 pivot area. However, the safe-haven asset has also fought against a sustained descent below the $1838 support, putting it in a consolidated range.
Depending on the outcome of the FOMC meeting later today, gold could finally breach the $1838 support and head towards lower support levels.
Source: https://learn2.trade
