Intraday Market Analysis – Gold Struggles At Resistance

July 12, 2021

XAUUSD rally slows down

Gold grinds higher as the US dollar softens amid lower Treasury yields.

The rally slowed as the bulls pushed towards the key resistance at 1824. A bullish breakout could trigger an extended rally and further confirm the reversal.

However, the RSI divergence may temper the enthusiasm. Its failure to follow the price and achieve a higher high is a warning sign of fading momentum.

1790 is the immediate support and its breach could send the price to 1775, where the precious metal first broke out of its bearish range.

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CADJPY recovers temporarily

The Canadian dollar bounces back after a fall in June’s unemployment rate.

The drop below 88.00, the origin of the previous rebound, has put the loonie back on the correction path.

The RSI’s double-dip into the oversold zone has prompted intraday players to take profit, momentarily driving up the price.

This may turn out to be a dead cat bounce as the pair tests the supply area around 88.80. A drop below 87.40 could lead to another round of sell-off towards the major demand zone around 86.50 on the daily chart.

UK 100 holds above daily support

The FTSE 100 recovers as lackluster GDP growth may keep the BOE off the hawkish path.

The index is in consolidation between the daily support at 6940 and 7200. As long as the bulls bid up the price above the support, the medium-term rally is still intact.

The current volatility is a sign of short-term turnover. After the RSI rose back from an oversold situation, price action found support at the psychological level of 7000.

7150 is the resistance ahead, a breakout could challenge the peak at 7200.

By Orbex