Gold -
Gold trades below $2500 on strong yen. It hit a low of $2473.69 yesterday and is currently trading around $2475.
US ISM PMI rose to 47.2 in Aug from July’s 46.8, below the forecast of 47.50.
The minor sell-off in US treasury yield will prevent the yellow metal from further sell-off.
According to the CME Fed watch tool, the probability of a 25 bpbs rate cut in Sep increased to 63% from 62% a week ago.
US dollar index- Bullish. Minor support around 101.20/100.50. The near-term resistance is 102/102.80.
Factors to watch for gold price action-
Global stock market- Bearish (Positive for gold)
US dollar index - Bullish (negative for gold)
US10-year bond yield- Bullish (negative for gold)
Technical:
The near–term support is around $2470, a break below the target of $2449/$2430. The yellow metal faces minor resistance around $2500 and a breach above will take it to the next level of $2509/$2525.
Indicator (4-hour chart)
CCI (14)- Bearish
CCI (50)- Bearish
Average directional movement Index - Bearish.
It is good to buy on dips around $2452-53 with an SL around $2430 for a TP of $2525/$2550.
