The yellow metal remains vulnerable to losses, as the US Treasury yields and the dollar continue to cheer the prospects of a bigger-than-expected fiscal stimulus plan, of about $2 trillion, likely to be announced by President-elect Joe Biden on Friday.

Political drama continues in white house. President Donald Trump was impeached for the second time in his term amid his role in the Capitol riots. Ten House Republicans voted with Democrats, but the Senate is unlikely to hold a trial before January 20, allowing Trump to conclude his term. Markets are focused on Biden’s plans rather than the political drama.

Jerome Powell, Chairman of the Federal Reserve, speaks later in the day and will likely give a message of stability regarding the Fed’s bond-buying scheme. His colleagues have been talking about the possibility of tapering the scheme, somewhat encouraging the dollar.  Gold traders will keep an eye on this speech.

The stalled US labor recovery has markets again looking to the initial claims early warning for evidence of the extent and duration of the slowdown. For the month until the next Nonfarm Payrolls on February 5 every claims report will be a good for the economy.

First time filings for unemployment benefits are expected to dip to 780,000 in the January 8 week from 787, 00 prior. Continuing Claims are were 5.072 million and the four-week moving average was 818,750 in the week of January 1.

XAU/USD 4 Hour Chart:

Support: 1836.4 (S1), 1828.6 (S2), 1815.3 (S3).

Resistance: 1857.4 (R1), 1870.7 (R2), 1878.4 (R3).

Amidst all the catalysts favoring greenback against the yellow metal, we expect a bearish trend for XAU/USD.