Gold price edges higher amid overall US Dollar weakness and lower US bond yields

• Gold price catches fresh bids on Thursday and reverses a part of the overnight decline.
• Bets that the Fed is done raising rates prompt fresh USD selling and remain supportive.
• A move beyond the $2,010 resistance is needed to support prospects for further gains.

Gold price (XAU/USD) attracts some dip-buying during the Asian session on Thursday and reverses a part of the previous day's retracement slide from the vicinity of the monthly peak. A two-day-old US Dollar (USD) recovery move from its lowest level since August 31 touched on Tuesday falters near the 100-day Simple Moving Average (SMA) amid firming expectations that interest rates in the US have peaked. This is reinforced by a fresh leg down in the US Treasury bond yields, which undermines the Greenback and acts as a tailwind for the non-yielding yellow metal.

The precious metal, however, remains below the $2,000 psychological mark. This, along with the recent repeated failures ahead of the $2,010 horizontal barrier, warrants some caution before placing fresh bullish bets around the Gold price amid a relatively light trading session ahead in the wake of the US Thanksgiving holiday. Nevertheless, dovish Federal Reserve (Fed) expectations might continue to act as a tailwind for the XAU/USD, suggesting that any meaningful corrective decline might still be seen as a buying opportunity and is more likely to remain limited.

Daily Digest Market Movers: Gold price regains positive traction and draws support from renewed USD weakness

• The emergence of fresh selling around the US Dollar assists the Gold price to regain positive traction during the Asian session on Thursday.
• The hawkish FOMC minutes-inspired USD recovery falters in the wake of expectations that the Federal Reserve (Fed) will not hike rates further.
• Policymakers reiterated the stance to keep rates higher for longer and remain committed to tightening policy further if progress in controlling inflation falters.
• The current market pricing, however, indicates a greater than 50% chance that the US central bank will start cutting interest rates by May 2024.
• Dovish Fed expectations, meanwhile, overshadow the better-than-expected US labor market and consumer sentiment data released on Wednesday.
• The number of Americans filing new claims for unemployment benefits fell more than expected last week, to 209K, or the lowest level in more than a month.
• The University of Michigan's survey of consumer sentiment showed that US consumers' inflation expectations rose for a second straight month in November.
• Other US data showed orders for long-lasting US manufactured goods fell more than expected in October, pointing to slowing economic demand.
• Lighter trading volumes on the back of the US Thanksgiving holiday and repeated failures ahead of the $2,010 level warrant caution for bullish traders.

Technical Analysis: Gold price needs to make it through the $2,010 strong barrier for bulls to regain near-term control

From current levels, any subsequent move beyond the $2,000 mark might continue to confront stiff resistance near the $2,007 area. Some follow-through buying, leading to a subsequent breakout through the $2,009-2,010 barrier, or a multi-month peak touched in October, will be seen as a fresh trigger for bullish traders. The Gold price might then accelerate the positive move further towards the $2,022 intermediate resistance en route to the next relevant hurdle near the $2,040 region.

On the flip side, the $1,989-1,988 zone is likely to protect the immediate downside ahead of the $1,979-1,978 region and the weekly low, around the $1,965 area. Failure to defend the said support levels might prompt aggressive technical selling and drag the Gold price back towards the 200-day Simple Moving Average (SMA), currently around the $1,940 level. This is closely followed by the  50- and 100-day SMA confluence, around the $1,933-1,932 region, which if broken decisively might shift the near-term bias in favour of bearish traders.