A slew of poor economic data from the US has put the greenback under additional pressure, allowing gold price on the XAU/USD pair to sprint off towards the $1895 price level.
Disappointing consumer confidence data and declining new home sales are just two of the market fundamentals that have allowed gold to extend the recovery towards the $1900 mark. New homes sales declined 5.9%, with March’s sales revised sharply lower from 1.021 million units to 917,000 units. The latest figure of 863,000 units is a far cry from the 970,000 that markets projected.
Also, cooling of inflation fears drove away any potential USD demand, as Fed officials continue to douse any notions of early tapering or earlier-than-planned rate hikes.
Technical Outlook for XAU/USD
Gold price activity for Tuesday has taken the XAU/USD clear of the 1881.68 resistance. The next available target for gold price lies at the 1900.95 psychological price level, above which 1930.88 and 1960.00 become new upside targets. The current price is the highest gold price has been since 30 December 2020.
On the other hand, a pullback from the 1900.95 area allows for a retest of 1881.68. Other targets to the south now playing reversed roles as support levels include 1860.77, the price wall at 1840/1828 and the 1815.20 price levels.