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Gold is constrained in a horizontal channel

Gold finished trading in Asia with a slight decline due to the recovery in US Treasury yields. At the beginning of the European session, the bulls won back losses due to the weakening of the dollar, but the prospects for further development of the upward movement remain limited due to low demand for defensive assets.

Major indices are trading in green territory today. Investors continue to win back positive data on the US labor market. The weekly jobless claims in the US fell to an annual low of 684,000. The market hopes for a recovery in the world's largest economy are growing.

The dollar index remains the main benchmark for gold. Today the US currency is under moderate pressure as many investors take long positions in the dollar after renewing 4-month highs. Increased investor interest in risky assets also has a negative impact on the American currency.

The overall fundamental background for gold is now mixed, so in the near future we can see the continuation of consolidation in a narrow range.

In the economic calendar, it is worth paying attention to the publication of data on the price index of personal consumption expenditures.

Following gold, other metals are also recovering. Silver has risen in price by 0.8% since the beginning of the day, platinum by 0.5%, the price of palladium has risen by 0.7%.

Nothing new on the chart. The price is held in the horizontal channel 1722.70 -1753.50. Today we are waiting for the continuation of the sideways trend.

  • Resistance levels: 1753.50, 1760.00, 1810.00.
  • Support levels: 1722.70, 1700.00, 1680.00.

The main scenario is growth to 1753.50.

An alternative scenario is a breakdown of the support at 1722.70 and a decline to 1700.00.

The current fundamental background is neutral. We will trade based on the borders of the 1722.70-1753.50 flat.

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