Daily Analysis XAUUSD - 28 July 2023

Gold price rebounded slightly on Friday amid concerns of a potential recession and worsening US-China relations, supporting XAU/USD. However, the metal's upside is limited due to expectations of more interest rate hikes by major central banks. The recent hawkish outlook from the Federal Reserve and strong economic data from the US contribute to this sentiment.

The ongoing uncertainty and geopolitical risks may prevent aggressive bearish bets on gold for now. Nevertheless, the metal could face modest losses for the first time in four weeks as market focus shifts to next week's crucial US macro data.

Traders are closely watching the US Core PCE Price Index release for clues about the Fed's future policy moves, which could impact the USD and influence gold's direction.

Yields are coming back higher after yesterday’s US data and this also putting pressure on gold to the downside.

The gold selloff took the price down to the confluence point of the 1942 area, where we have a strong support historical level and the 200MA (200-day moving average) also resides. A rebound from this level is more likely than a continuation down, especially considering the possibility that the yields on the US10Y may retreat after yesterday's run. The likelihood of a breakout below the 1942 area is less probable to occur.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1982	1970	1960	1940	1931	1920