Fundamental view:

Gold fell against greenback last week as It was hit by a slate of negative news. This week’s primary downward pressure came from rising U.S. Treasury yields mixed in with the stronger U.S. dollar. The sharp upsurge witnessed in the US Treasury bond yields helped the USD stay resilient against its rivals and caused XAU/USD to lost more than 1% on the day. On Wednesday, the upbeat macroeconomic data releases from the US provided an additional boost to the greenback and XAU/USD extended its slide. 

In the past week, The US Census Bureau reported that Retail Sales in January increased by 5.3% and it beat the market expectation for an increase of 1% by a wide margin. Elsewhere, Industrial Production in the same period expanded by 0.9%, compared to analysts’ estimate of 0.5%. Finally, the FOMC’s January meeting minutes showed that policymakers remained cautiously optimistic about the economic outlook.  All these catalysts favored greenback against the yellow metal.

The major economic events deciding the movement of the pair in the next week are Fed Governor Bowman Speech at Feb 22, Fed Chair Powell Testimony, CB Consumer Confidence Index at Feb 23, Fed Chair Powell Testimony, EIA Crude Oil Stocks Change at Feb 24, GDP quarterly report, Core Durable Goods Orders monthly report, and Initial Jobless Claims at Feb 25 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 1.55% lower than the previous week. Maintaining high at 1827.0 and low at 1760.6 showed a movement of 664 pips.

In the upcoming week we expect XAU/USD to show a bearish trend.  The Instrument is trading below the 200 Simple Moving Average and the MACD trades to the downside. A solid breakout below 1754.2 may open a clean path towards 1724.2 and may take a way down to 1687.8. Should 1820.6 prove to be unreliable resistance, the XAUUSD may raise upwards 1857.0 and 1887.0 respectively. In H4 chart bearish gartley pattern formation favors prospects of a bearish trend. Also to be noted bearish harami formation exerts the expectation of downtrend for the pair.