The price of gold has fallen for 4 consecutive days, and there is a lack of important data and events in the follow-up. Gold bears may continue to dominate the market. The 1750 mark is

Gold remains under pressure within a bullish pattern after four-day losing streak

· Fed officials are basically hawkish, China recession worries put downward pressure on gold prices

Stronger U.S. data also helps gold/dollar bears maintain their dominance

Light data keeps risk catalysts still the main driver, or gold prices continue to fall

In early Asian trading on Friday, spot gold prices hovered near a two-week low of $1,760 an ounce recorded the previous day, as traders sought fresh clues within a bullish pattern.

The London gold has fallen for the past four sessions as hawkish Fed officials, stronger U.S. data and a broad-based rally in the U.S. dollar on recession fears in China and Europe.

The U.S. dollar index rose to its highest level in a month in the previous day as the Philadelphia Fed's manufacturing index rose and jobless claims fell last week. The former rose to 6.2, expected -5, the previous value of -12.3, while last week's initial jobless claims fell to 250,000, expected 265,000, the previous value was revised to 252,000.

Elsewhere, San Francisco Fed President Mary Daly mentioned that they (the Fed) will continue to raise interest rates "to the right amount." Either 50 basis points or 75 basis points would be appropriate, the policymaker added, while hinting at a rate hike in September. However, Reuters reported that regarding the September rate decision, Minneapolis Federal Reserve Neil Kashkari mentioned that he does not believe the U.S. is currently in a recession. Separately, St. Louis Fed President James Bullard, who has been hawkish, said he is leaning toward another 75 basis points of rate hikes in September.

Notably, Goldman Sachs and Nomura both cut their growth forecasts for China after witnessing the latest jump in Chinese Covid-19 data. Also weighing on the Chinese economy are questions about the People's Bank of China's (PBOC) ability to contain recessionary disasters. In addition, comments from the Office of the U.S. Trade Representative that "the United States and Taiwan will begin formal negotiations on a trade initiative in the early fall of this year" appeared to rekindle concerns about a U.S.-China rivalry and disturbed the atmosphere. Considering that Beijing is one of the world's largest consumers of gold, the negative factors in China have weighed on spot gold prices.

On the other hand, Germany's finance ministry said in its August monthly report that "the economic outlook for Germany, Europe's largest economy, is bleak due to higher energy prices and supply chain disruptions," Reuters reported.

Affected by this, U.S. stocks closed mixed, while U.S. 10-year stock and bond yields retreated from monthly highs.

Going forward, gold bears are likely to continue to dominate the market due to the lack of important data and events.

Gold prices hovered near three-week lows.

FXStreet analyst Dhwani Mehta reported that sellers have more opportunities to show their strength. If the psychological barrier of $1,750 is sustained, gold bears will aim for the next downside target near $1,730.

“A breakout of the 21-day moving average (DMA) around $1,766 would be the key to kick-starting a meaningful rally. However, the sliding 50-day moving average (DMA) around $1,774 would be a tough hurdle for bulls to overcome. A breakout of the latter would open up new buying opportunities, May see gold/dollar retest Wednesday's high of $1,782."

Rising U.S. Treasury yields weighed on gold investors' appetites, while a slightly stronger dollar was detrimental to investor demand. Economists at ANZ Bank expect gold to find a bottom at the $1,700 level.

“ Aggressive Fed rate hikes and a stronger dollar weighed on gold prices. At the same time, there should be some safe-haven funds amid heightened recession fears due to rising rates and sticky inflation. With currency depreciation and rising geopolitical risks, central bank Purchasing power for gold is likely to be strong. This should help ease the weakness in physical demand. We expect gold to bottom around $1,700. ”

technical analysis:

Gold prices held near the support line of a one-week bullish descending wedge. Gold is at risk of further downside against the USD given that the RSI is oversold and the price has broken below the wedge support line at $1754. The 200 SMA at $1,750 could further challenge the gold bears.

Meanwhile, a move above $1,769 would confirm a bullish pattern, with gold theoretically heading towards $1,820. However, the 50 SMA and monthly highs at $1782 and $1808, respectively, could challenge gold bulls.

Gold: 4-hour chart

JRFX reminds you: the market has risks, and investment should be cautious. This article does not constitute personal investment advice, please choose the corresponding investment products according to your own financial and risk tolerance, and do a good job of corresponding risk control.

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