GOLD Analysis – November 10, 2021

Gold’s Daily Price Analysis

Gold prices closed at $1830.80 after setting a high of $1834.80 and a low of $1821.00. On Tuesday, gold advanced for the 4th consecutive session on Tuesday and reached its highest since September 7th on the verge of a weak greenback. The US dollar index, which measures the greenback's value against the basket of six major currencies, dipped on Tuesday for the third consecutive session and reached the 93.88 level, which ultimately weighed on the US dollar and supported gold prices for the day. The yield on the benchmark 10-year note in the United States fell to 1.41% on Tuesday, the lowest since September 23rd, adding pressure to the US dollar and providing additional support to gold.

The weak US dollar against its rival currencies made bullion less expensive for holders of other currencies and pushed gold higher on Tuesday. Furthermore, the gold appeal was lifted higher as key central banks indicated interest rates would remain low in the near term, which pushed the precious metal to its best week since late August.

On the data front, at 16:00 GMT, the NFIB Small Business Index dropped to 98.2 from the expected 99.4 and weighed on the US dollar, which added further gains in gold prices. At 18:30 GMT, the PPI remained flat with an expected 0.6%. The Core PPI fell to 0.4% from the anticipated 0.5%, which added pressure on the US dollar, dragging gold prices even further to the downside.

Meanwhile, as the major central banks worldwide indicated that they would not increase interest rates in the near term, inflation concerns surged in the market. Persistent inflation concerns raised uncertainty in the market and supported the safe-haven metal on Tuesday, which reached its 2-month highest level.

Meanwhile, the daily coronavirus cases have reached their highest since the pandemic began in Greece in February 2020. Hospitals around the country came under pressure from rising infections and raised concerns around the region. On the UK front, the country recorded another 32,322 coronavirus cases and 57 deaths on Tuesday.

Despite the opening of economies and vaccine inoculations worldwide, the rising number of cases across different regions added to the concerns, supported the risk-off market sentiment, and pushed gold prices higher on Tuesday.

GOLD Intraday Technical Level

Support Resistance

1822.94 1836.74

1815.07 1842.67

1809.14 1850.54

Pivot Point: 1828.87

GOLD - Technical Outlook

On Wednesday, gold’s bullish trend seemed to get weaker below the $1,833 resistance level. The closing of a bearish engulfing candle below the 1,832 level also reveals a weakness in the bullish trend. Typically, a bearish engulfing candle drives a sell in the market. On the bullish side, the XAU/USD’s next resistance is at the 1,833 level, which is extended by an upward channel.

Whereas gold’s immediate support prevails at the 1,827 level, which is being extended by an intraday pivot point level. A break below this level has the potential to extend the selling trend to the 1,822 (23.6% Fibonacci retracement level) and 1,814 (38.2% Fibonacci retracement level). Conversely, a breakout of the 1,833 level exposes gold towards the 1,840 resistance level. Hence, the bearish bias dominates below the 1,828 level and vice versa. All the best!