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XAU/USD: Technical Analysis Report 04 March 2021

XAU/USD: Technical Analysis Report 04 March 2021

Current Trend

 Gold price is under pressure amid rising US Treasury yields. The yield on the 10-year bonds has been growing for the fifth straight week and is at 1.472%, preparing to break the 1.5% level. The yield on 10-year TIPS (yield adjusted for inflation) rose over the month from –1.0310% to –0.750%. Rising US inflation is not keeping gold from falling. The US Fed claims that it is in control of the situation and is not going to change its policy.

 Yesterday’s ADP Nonfarm Payrolls data failed to weaken USD. The value of the indicator was 117K against the projected 177K. The previous figure has been revised from 174K to 195K. Markets are awaiting official data on Friday. Employment growth by 182K is expected.

 Today, investors will be focused on the data on Initial Jobless Claims (15:30 GMT+2), as well as on the speech of the Fed Chair Jerome Powell (19:05 GMT+2). Analysts predict an increase in the number of applications from 730K to 750K compared to last week.

 Support And Resistance

 Gold is trading in a price channel, the lower border of which, serving as support, was reached yesterday. The RSI indicator indicates that the market is oversold. The global support at 1735.00–1685.00 can be noted. Holding this zone will lead to a rise in prices in the medium term to 1870.00. A breakdown of this area will allow a drop to 1625.00, 1575.00.

 The mid-term trend is downward. Target zone 2 was broken during the week in the area of 1759.00–1749.00. The next target is at 1659.00–1649.00 (target zone 3). The trend border is at 1822.90–1811.90.

 Resistance Levels: 1808.00, 1870.00.

Support Levels: 1715.00, 1625.00.

 Trading Tips

 Long positions may be opened above 1735.00 with target at 1808.00 and stop-loss at 1710.00. Implementation time: 7-9 days.

 Short positions may be opened below 1685.00 with target at 1625.00 and stop-loss at 1715.00.


 Timeframe: Weekly

Recommendation: Buy Stop

Entry Point: 1735.10

Take Profit: 1808.00

Stop Loss: 1710.00

Key Levels: 1625.00, 1715.00, 1808.00, 1870.00

 Alternative Scenario

 Timeframe: Weekly

Recommendation: Sell Stop

Entry Point: 1684.95

 Take Profit: 1625.00

Stop Loss: 1715.00

Key Levels: 1625.00, 1715.00, 1808.00, 1870.00

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