Charts of the Week - XAU/USD – Gold Near Super Inflection Zone.

• Resistance Zone: $1780 to $1800
• Key Resistance: $1750
• Major Pivot Point: $1720
• Support Zone: $1680 to $1660
• 200 Day SMA – Green Line
• CBOE VIX – Volatility Index @ 23.88 +0.62 (-2.53%)

Trade Insights – XAU/USD

The chart shows Viable Long positions above the Support Zone between $1680 to $1660. With the first target of the Pivot Point at $1720. After consolidation above the Pivot, further Long Positions head towards $1750, the Key Resistance Level. And if this Resistance is broken then Gold could jump towards the Resistance Zone at $1780 to $1800.

Alternatively, Short positions below the Support zone at $1680 to head towards the next support level at $1650.

XAU/USD Chart Analysis:  Directional bias - 2 Weeks 

XAU/USD chart shows that the pair is just trading above a major long-term support Zone. And at the 11-month low point between $1700 to $1680 on the chart. Gold touched this point thrice in 2021 and jumped back up all three times. The chart shows that the Gold could be sitting at a major inflection point and could bounce back up from here. At the time of writing the Dollar index, DYX dropped from its recent peak of 109.32 on 14^th July and is now down to 106.964 and seems to look for support.

The drop from the peak of $2069 to $1692 now is just 4 months’ time is an 18.22% decline in the gold prices against the Dollar. This shows gold has gone down too far too soon given the geo-economic issues and could be digging for support to change the trend upwards. The chart replicates this analysis and shows through the RSI indicator that is trading at 22.93 points. And it is in a super oversold zone. Any rebound from here in the prices could be vertically sharp. Prices are also trading far below the 200-Day SMA Green line showing the bearish bias of the market could change to reduce the gap between the SMAs and the price.

Fundamental Overview:

ECB meeting outcome is due today. The firm US Dollar’s strength and US Bond Yields are pushing the Gold downwards and the next crucial move market is waiting for from Federal Reserve is to come in their FOMC meeting that is due on 27^th July. After hitting the peak at 3.47% on 14th June the US 10 Year Bond Yield is now sitting at 3.013%. currently.  This is one of the prime reasons the money from Gold and other avenues are flowing into these more profitable avenues that are offering yield for investors' idle capital that Gold fails to offer.