Technical Analysis

GOLD Analysis – November 01, 2021

By LonghornFX Technical Analysis
Nov 1, 20213 min

Gold’s Daily Price Analysis

Gold finished the day at $1788.90, with a high of $1802.90 and a low of $1772.40. Gold fell on Friday as the US dollar made a strong rebound and the US government yield rose. The benchmark 10-year Treasury note yield held unchanged throughout the day, closing at 1.56 percent after rising to 1.61 percent. Whereas the US Dollar Index, which measures the greenback's value against a basket of six main rival currencies, recovered and raised its prices to 94.30, adding strength to the US dollar and having a negative impact on yellow metal prices.

The precious metal fell after investors braced themselves for more information on the withdrawal of economic stimulus from the Federal Reserve's meeting next week. The threat of interest-rate hikes, either in the near or distant future, kept gold prices under pressure for the day.

Gold prices are also lower for the day due to concerns that the next FOMC meeting will include an announcement about slowing the pace of economic stimulus. While gold is considered a hedge against inflation, the possibility of increased interest rates and weaker economic support was pushing government bond yields and the dollar higher, keeping the yellow metal's market attractiveness down.

On the data front, the Core PCE Price Index for September stayed steady at 17:30 GMT, compared to the projected 0.2 percent. For the third quarter, the Employment Cost Index increased to 1.3 percent, exceeding the forecasted 0.9 percent, bolstering the US dollar and adding to gold's losses. The Personal Income fell to -1.0 percent, versus the projected -0.2 percent, weighing on the US currency and causing gold prices to fall further.

Personal spending remained unchanged at 0.6 percent, as expected. At 18:45 GMT, the Chicago PMI for October climbed to 68.4 from 63.6, supporting the US dollar and adding further pressure to the yellow metal. At 19:00 GMT, the Revised UoM Consumer Sentiment was 71.7, which was in line with forecasts. The Revised University of Michigan Inflation Expectations remained constant at 4.8 percent.

Meanwhile, tensions between the United States and China over the trade pact, Taiwan, and the origin of the coronavirus kept the market unsettled, resulting in significant losses in yellow metal prices. Wang Wenbin, a spokesman for China's foreign ministry, recently stated that a declassified US intelligence study claiming that it was conceivable that the COVID-19 epidemic originated in a laboratory was unscientific and without credibility.

GOLD Intraday Technical Level

Support Resistance

1779.36 1784.21

1777.48 1787.18

1774.51 1789.06

Pivot Point: 1782.33

GOLD - Technical Outlook

On Monday, the previous metal, gold, bounced off above the support level of 1,771 levels. The safe-haven gold is currently trading at $1,785, holding above an immediate support level of $1,782.This particular support level is extended by an intraday pivot point level. Therefore, the precious metal gold’s bullish bias seems to dominate today.

The break below the 1,782 level exposes gold's price towards the next support level of 1,768. On the upside, gold’s next resistance stays at 1,798 level, and a break above this level exposes the pair towards 1,813 level.

Alongside, the MACD is supporting a selling bias in gold. Therefore, the bearish bias dominates below 1,798 and vice versa. All the best!


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