Daily Analysis XAUUSD - 29 Aug 2023

The gold price (XAU/USD) is defending its previous weekly recovery, marking the first positive movement in five weeks. This ascent over the last two days is driven by a weakening US Dollar and a sense of cautious optimism in the market. Additionally, the decline in Treasury bond yields is contributing to the rebound.

The US Dollar Index (DXY) is benefiting from the Federal Reserve's data dependency stance, coupled with a mix of recent US economic data. The pullback in US Treasury bond yields from the previous week's multi-year high is also supporting the DXY's performance.

In another context, the anticipation of further stimulus from China, both through fiscal and monetary policies, is sustaining hope among gold buyers.

However, a cautious sentiment prevails ahead of upcoming US inflation and employment indicators, as well as Chinese activity data. These factors are influencing XAU/USD bulls, particularly around the critical $1,940 resistance level.

To sum up, the gold price possesses several catalysts that favor potential upward movement. Yet, the outcome hinges on factors such as the resistance at $1,940, the broader weakness of the US Dollar, and the impact of downbeat yields. These elements will determine the extent of future advances in XAU/USD.

Gold made a moderate movement upside toward the 1926 level while the next resistance level is in 1931. For gold to continue up the yields need to do a comeback. The next solid resistance level is at the 1940-45 area.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1940	1920	1942	1900	1875	1845