Gold Price Analysis: XAU/USD to cheer bullish traders once above $1916

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Gold is hovering around $1,900, benefiting from lower US yields. As FXStreet’s Haresh Menghani notes, around $1,916 holds the key for XAU/USD bulls.

See – Gold Price Analysis: Lower US Real Yields to lift XAU/USD towards $1943/66 – Credit Suisse

The lack of follow-through momentum warrants some caution

“Market participants now look forward to the release of the Preliminary Michigan US Consumer Sentiment index for some impetus later during the early North American session. Apart from this, the US bond yields and the broader market risk sentiment might further contribute to produce some trading opportunities on the last day of the week.” 

“The key focus will be on the upcoming FOMC meeting on June 15-16, which will play a key role in determining the next leg of a directional move for the commodity.”

“From current levels, any subsequent move up is likely to confront resistance near the monthly swing highs, around the $1,916-17 zone. Bulls are likely to wait for a sustained strength above the mentioned barrier before positioning for any further appreciating move. The XAU/USD might then aim to test the next relevant hurdle near the $1,951-53 supply zone with some intermediate resistance near the $1,928-30 region.”

“Immediate support is pegged near the $1,887-85 area, below which bearish traders are likely to aim back to challenge the ascending trend-line support, currently near the $1,870 region. A convincing break below will negate prospects for any further gains, instead prompt some aggressive selling and drag the commodity back towards the very important 200-day SMA support, currently near the $1,840 level.”