Gold Price Forecast: XAU/USD needs acceptance below $1750 to seek additional downside

Gold price retreated sharply from eight-day highs of $1771 and tested the recent range lows just below $1750 on Tuesday, before recovering to settle the day at $1760. Wednesday’s trading so far is no different for XAU/USD, as bears remain in control. Why does XAU/USD look vulnerable below $1750? FXStreet’s Dhwani Mehta explains it.

See – Gold Price Forecast: XAU/USD to struggle in the face of rising yields and stronger USD – Credit Suisse

Bearish 21-Daily Moving Average (DMA) at $1767 remains a tough nut to crack for gold buyers

“The US dollar looks to extend the renewed upside while Treasury yields keep pushing higher, weighing negatively on the yieldless gold price. Markets also turn cautious ahead of the US ADP Employment Change numbers, especially after stronger US ISM Services PMI, as it could seal in Fed’s tapering as early as next month.”

“US-China trade jitters, China Evergrande’s debt crisis and a stalemate over the American debt ceiling could keep the overall market sentiment undermined, which may put a floor under gold price, in the wake of a flight to safety.”

“The September 27 highs of $1745 remain on the sellers’ radars if the recent range lows near the $1749 region is cleared on a sustained basis. Further south, the seven-week lows at $1722 could be back in play.”

“Only a daily closing above the short-term critical 21-DMA at $1767could revive the recent recovery momentum, opening gates towards the downward-sloping 50-DMA at $1782. Gold bulls will then target the $1800 psychological magnate.”