GOLD Analysis – November 19, 2021

Gold’s Daily Price Analysis

Gold prices were closed at $1861.10 after setting a high of $1873.30 and a low of $1856.65. Gold fell on Thursday, despite falling US dollar prices, as expectations for an earlier-than-expected rate hike by the United States' central bank grew due to the latest surge in jobless claims.

Despite the declining price of the precious metal, bullion remained close to its highest level in five months that it touched on Tuesday. During the previous week, the number of Americans registering new claims for unemployment benefits fell close to pre-pandemic levels, reducing demand for safe-haven metal and raising bets on a rate hike sooner than expected.

The US Dollar Index fell to 95.52 on Thursday, while the US Treasury Yield on the benchmark 10-year note fell to 1.57%, adding to the negative impression of the US dollar and limiting further losses in gold prices. On Thursday, New York Federal Reserve President John Williams said that inflation in the United States was becoming more broad-based, and expectations for future price increases rose. He stated that he would closely monitor this trend because some of the price increases caused supply and demand imbalances, while the pandemic caused others.

Atlanta Federal Reserve President Raphael Bostic believes that the Federal Reserve will begin raising interest rates in the middle of next year as the US economy recovers and returns to pre-pandemic levels. He was optimistic that the job figures were reaching closer to the pre-pandemic levels. Whereas, Chicago Federal Reserve President Charles Evans has said that it will take until next year to complete the tapering of bond purchases that started in November 2021.

All these comments had mixed effects on the US dollar and kept gold under pressure for Thursday. On the data front, at 18:30 GMT, the Philadelphia Fed Manufacturing Index rose to 39.0 against the anticipated 24.2 and supported the US dollar, which ultimately added to the loss in gold prices.

Last week's unemployment claims rose to 268K, exceeding the 260K forecast, weighing on the US dollar and limiting further declines in the yellow metal. At 20:0 GMT, the CB Leading Index also increased to 0.9% against the anticipated 0.8% and supported the US dollar, which added a further loss in XAU/USD on Thursday.

GOLD Intraday Technical Level

Support Resistance

1854.06 1870.71

1847.03 1880.33

1837.41 1887.36

Pivot Point: 1863.68

GOLD - Technical Outlook

Gold is trading at the 1,858 level, having dropped below the pivot point support level of 1,861. The yellow metal gold is gaining immediate support at the 1,855 level, and violation of this exposes the metal towards the 1,852, 1,845, and 1,836 levels.

On the bullish side, the major resistance stays at the 1,861 level, and that’s being extended by a pivot point level. A bullish breakout of that level exposes the metal towards the 1,868 and 1,877 resistance levels.

Taking a look at the RSI and stochastics indicators, they show a bearish trend in gold. Therefore, gold’s bearish bias dominates below the 1,861 level and vice versa. All the best!