We had a positive start for the XAU/USD gold price for this week's trading.
- The bulls succeeded in capturing the top of the 1700 dollars an ounce, after capping its best week since mid-August, as the dollar's decline provided some relief to the precious metal.
- Bullion prices posted their first weekly gain in three on Friday, with easing Treasury yields also helping to boost the attractiveness of non-interest-bearing assets.
- Gold fell to a two-year low earlier in the week on the back of rising dollar and bond yields.
The XAU/USD gold price fell to the level of 1615 dollars an ounce at the end of last month's trading. Coinciding with the rise in the price of the US dollar to its highest level in more than two decades.
However, bullion prices could experience more volatility, with critical US labor market readings remaining tight later this week. The numbers may provide clues to the path of a US interest rate hike from the Federal Reserve, as the strong numbers are likely to spur further gains in bond yields that would be detrimental to gold.
On the other hand, it affects the sentiment of investors and markets. China's financial regulators have asked the country's largest state-owned banks to provide more funding to the country's beleaguered real estate sector in the last four months of this year, according to a report on Friday. Meanwhile, the new CEO of Credit Suisse Group AG asked investors to allow time to present a turnaround strategy after sharp drops in the bank's share price.
Commenting on this, Gnanasekar Thiagarajan, Principal at Commtrendz Risk Management Services, said the "improving outlook for China" and the possibility of further declines in Treasury yields could improve gold prices. He added that the additional decline in the share price of Credit Suisse may provide some demand for gold as a safe haven.
XAU/USD Gold Price Forecast Today:
There is no doubt that the gold price's move towards the psychological top of 1700 dollars an ounce supports the bullish change, but to confirm the shift on the bulls, the move more in XAU/USD gold prices towards the resistance levels of 1720 dollars and 1745 dollars, respectively. On the other hand, according to the performance on the daily chart, the hopes of rebounding upwards will evaporate if the gold price returns to the vicinity of the support level of 1655 dollars an ounce.
The price of gold today will be affected by the level of the US dollar and the extent to which investors take risks or not.
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