Gold Price Analysis: XAU/USD upside running out of steam above $1,730
- Gold prices recede from an intraday high of $1,743.32, snaps three-day winning streak.
- US dollar pullback weighs on the commodity basket.
- Riots in the US, Sino-American tension could offer immediate direction.
Gold prices drop to $1,737, down 0.14% on a day, while heading into the European session on Tuesday. In doing so, the yellow metal stalls the previous three-day rise while stepping back from the intraday high of $1,743.32.
Even if the US-China tussle remains on the cards, the recent pick-up in the US dollar seems to have triggered the bullion’s pullback moves from the highest since May 21.
US Dollar Index (DXY) bounces off the lowest since March 16 to 97.87, gaining 0.07% daily, as trading sentiment turns stiff amid the riots in the US. The alleged police killing of George Floyd recently turned severe as protestors gathered near White House, which in turn pushed military to use force.
Additionally, US President Donald Trump showed readiness to use all the measures to tame the unrest. Even so, China’s Global Times criticizes the Republican leaders’ response to the domestic problem.
As a result, the stocks in Asia seem to fade the early-day rise whereas the US 10-year Treasury yields also decline nearly one basis point to 0.65%.
It should also be noted that the lack of major data/events also contributed to the bullion’s profit-booking moves.
Looking forward, a light calendar will push traders to keep eyes on the qualitative catalysts for fresh impulse.
Technical analysis
Unless breaking the four-day-old trend channel’s support, at $1,730 now, buyers can keep looking towards $1,753 mark, comprising the said channel’s resistance line.