Gold Price Analysis: XAU/USD on the defensive below $1930 level
- Gold struggled to capitalize on its early uptick amid a goodish pickup in the USD demand.
- The downside seems limited on the back of concerns about the global economic recovery.
Gold refreshed daily lows, around the $1927-26 region during the early European session, albeit lacked any strong follow-through selling.
The precious metal failed to capitalize on its early uptick, instead met with some fresh supply near the $1941-42 region and was being pressured by a strong pickup in the US dollar demand. As investors looked past Friday's mixed US monthly jobs report, the greenback was back in demand on the first day of a new trading week. This, in turn, was seen as one of the key factors weighing on the dollar-denominated commodity.
However, concerns about the global economic recovery, amid the ever-increasing COVID-19 cases extended some support to the precious metal's safe-haven status. Moreover, holiday-thinned liquidity conditions might further hold investors from placing any aggressive bets and might help limit any deeper losses, at least for the time being.
From a technical perspective, the commodity on Friday slipped below a near three-month-old ascending trend-line support but managed to find some support ahead of the $1900 mark. The subsequent range-bound price action warrants some caution for bearish traders and before positioning for any further near-term depreciating move.
A convincing break below the mentioned $1900 level should pave the way for a slide towards August monthly swing lows support near the $1863-62 region. The US markets are closed on Monday in observance of Labor Day. Hence, the USD price dynamics might continue to act as an exclusive driver of the commodity's intraday momentum.
Technical levels to watch