Ichimoku Analysis (4-Hour chart)
Tenken-Sen- $1918.14
Kijun-Sen- $1915.96
Gold pared some of its gains due to profit booking. The yellow metal was one of its best performers the previous week on weak US inflation. Hawkish commentaries by Fed policymakers preventing gold from further upside. Gold hits an intraday low of $1923.71 and is currently trading around $1923.92.
The number of people who have filed for unemployment benefits dropped by 15000 to 190K in the week ended Jan 14th, the lowest level since Sep. US Philly Fed manufacturing improves to -8.9 in Jan vs. -11 expected.
US dollar index- Bearish. Minor support around 101.50/100. The near-term resistance is 103.50/104.50.
According to the CME Fed watch tool, the probability of a 25 bpbs rate hike in Feb rose to 97.2% from 94.70% a week ago.
The US 10-year yield gained after hitting a low of 3.32%. Any break and close below 3.26% confirm minor bearishness. The yield spread between 10 and 2-year widened to -72 basis points from -46.9 bpbs.
Factors to watch for gold price action-
Global stock market- bearish (bullish for gold)
US dollar index – Bearish (positive for gold)
US10-year bond yield- Bearish (Positive for gold)
Technical:
The near–term support is around $1890, a break below targets of $1865/$1825.The yellow metal faces minor resistance around $1935, and a breach above will take it to the next level of $1950/$1969.
It is good to buy on dips around $1890 with SL around $1880 for TP of $1935/$1950.
