Technical Analysis

GOLD Analysis – December 09, 2021

By LonghornFX Technical Analysis
Dec 9, 20213 min

Gold’s Daily Price Analysis

Gold prices ended the day at $1784.60, with a high of $1794.25 and a low of $1789.15. Gold prices fell on Wednesday, owing primarily to higher US Treasury yields. Investors were wary about making big bids ahead of the US inflation report anticipated on Friday, which would cap precious metals' drop. The US Dollar Index, which measures the value of the dollar against a basket of six major currencies, fell to 95.85, weighing on the greenback and exacerbating the decline in gold prices. In contrast, US Treasury yields on the benchmark 10-year note resumed their optimistic climb and rose to 1.53 percent. That had a negative impact on gold and brought its prices even lower.

Pfizer and BioNTech presented a study from their laboratory experiments indicating that a booster shot of their coronavirus vaccine provides considerable protection against the rapidly spreading Omicron strain. This announcement increased market optimism about vaccine efficacy against Omicron and lessened fears of lockdowns, putting some pressure on safe-haven gold on Wednesday.

However, the current travel limitations, mostly in Europe due to the rising number of cases, provided some support to the yellow metal's decreasing values. Switzerland was dealing with a new high number of coronavirus infections, the United Kingdom reported roughly 51,343 new cases, and France saw an increase in COVID hospitalization.

Consumer credit fell to 16.9 billion at 01:00 GMT, falling short of the anticipated 24.9 billion, weighing on the US dollar on the data side. The JOLTS job openings increased to 11.03 million at 20:00 GMT, up from 10.45 million expected, supporting the US dollar. The macroeconomic data from the United States came in mixed on Wednesday, causing the US dollar to weaken, limiting the fall in gold prices.

Gold investors were looking forward to the release of US Consumer Price Index data on Friday, as it could impact the Fed's timeframe for withdrawing economic support before the next policy meeting on December 14 and 15. On Wednesday, decreasing gold prices could be attributed to rising Treasury yields as a result of bets on less stimulus and interest rate hikes, which tend to drive government bond yields higher and boost the opportunity associated with holding non-interest-bearing gold.

GOLD Intraday Technical Level

Support Resistance

1778.41 1792.51

1772.23 1800.43

1764.31 1806.61

Pivot Point: 1786.33

GOLD - Technical Outlook

Gold is currently trading at $1,783, rebounding from the 1,782 support level. On the 2-hour timeframe, the precious metal has created an upward trendline, indicating that gold is in an uptrend.

The 50-day exponential moving average supports the metal at a level of 1,782. A surge in demand over the 1,782 level can propel the market higher until it reaches 1,792 or 1,799. Conversely, a break beneath 1,782 allows for additional selling till the 1,774 level. All the best!


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