Gold - XAU/USD – Gold jumps up by 2.4% on Monday

Gold - XAU/USD – Gold jumps up by 2.4% on Monday, as yields across the board dropped and the Dollar index declined driven by ISM Manufacturing data.

Chart Analysis

Gold jumped up by 2.4% on Monday on the back of dropping US 10 Year Bond yield that peaked at just under 4% on 27^th September and is now down to 3.64% at the time of writing. The US Manufacturing September Data print came at an unexpectedly soft 50.9 number, lower than the 52.8 reading from August month. 50 reading on ISM Manufacturing is a cut-off for growth and expanding economic activity. So, this indicates the Manufacturing print barely made it above the cut-off line. This has somewhat cooled off the bets of interest rate hikes in 2023 and set expectations that the feds will not be so aggressive on their Interest rate hike path. Gold has an inverse relation to rate hikes and the Reserve Bank of Australia is expected to raise interest rates today. This may see a bit of pullback in gold in today’s session. While Gold has already jumped above the 20-Day SMA the next resistance is at $1715 and the 50-Day SMA is nearing around this point too.

Please check the Chart Trading Insights below

• Resistance Zone: $1732 to $1750
• Key Resistance Level: $1715
• Major Pivot Point: $1690
• Key Support Level: $1672
• Support Zone: $1655 to $1635
• 200 Day SMA – Green Line
• 50 Day SMA – Red Line
• 20 Day SMA – Blue Line

Daily Chart Directional bias - 2 Weeks 

Trade Insights – XAUUSD – Chart shows viable Long Positions above the Pivot at $1690 heading towards the first target of $1715 Key Resistance and then further test of the Resistance Zone between $1732 to $1750.

Possible entry of Long Trades above the Major Pivot Point at $1690.

Potential First take profit could be at - $1715

Potential Second take profit could be at - $1732

Potential Third take profit could be at $1750

Alternatively, possible Short positions if Gold drops below the Pivot at $1690 with the target to test the Key Support Level at $1672 and then the test of the Support Zone between $1655 to $1635.

Possible Entry for Short trades if Gold drops below the Pivot at $1690

Potential First take profit could be at - $1672

Potential Second take profit could be at - $1655

Potential Third take profit could be at - $1635