Fundamental view:

The early part of this week started off encouraging for Gold bulls. The yellow metal continued to push higher, riding a trendline that had built in December as buyers got back on the bid. This brought hope that bulls would be able to continue pushing prices higher but it snapped back aggressively on Wednesday before getting pulverized on Friday, leaving a number of question marks around long-term Gold trends.

The selling pressure surrounding the greenback that intensified in the last week of 2020 remained intact earlier in the week and helped XAU/USD push higher. However, the greenback gathered strength in the second half of the week on the back of soaring US Treasury bond yields and forced XAU/USD to reverse its direction.

The major economic events deciding the movement of the pair in the next week are JOLTS Job Openings at Jan 12, EIA Crude Oil Stocks Change, CPI monthly report at Jan 13, Initial Jobless Claims, Fed Chair Powell Speaks at Jan 14, and Retail Sales monthly report at Jan 15 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 2.98 % higher than the previous week. Maintaining high at 1959.3 and low at 1828.3 showed a movement of 1310 pips.

In the upcoming week we expect XAU/USD to show a bullish trend.  The Instrument is trading below the 200 Simple Moving Average and the MACD trades to the downside. A solid breakout above 1929.5 may open a clean path towards 2009.9 and may take a way up to 2060.6. Should 1798.5 prove to be unreliable support, the XAUUSD may sink downwards 1747.8 and 1667.4 respectively. In H4 chart bullish crab pattern formation favors prospects of a bullish trend. Also to be noted Bullish engulfing formation exerts the expectation of uptrend for the pair.