Gold falls below $1210 as greenback stays strong in the early NA session
- Wall Street starts the day in the red.
- US Dollar Index eases off daily highs, stays in the positive territory near 95.30.
The XAU/USD pair trades in a $9 range on Wednesday and stays directionless in its weekly range. After touching a daily low at $1206, in the early NA session, the pair staged a modest recovery but failed to stay above the $1210 mark. As of writing, the pair was trading at $1209, losing 015% on the day.
Earlier today, the US Dollar Index dropped toward the critical 95 mark but found support there and gathered momentum in the early trading hours of the session on the back of hawkish comments from Richmond Fed President Barkin. Speaking in a conference on Wednesday, Barkin argued that the tight labor market conditions and the inflation growth warranted further rate hikes and added that the Fed's benchmark rate yet was not at normal levels yet.
In the meantime, major equity indexes in the United States started the day on a negative note to point out to negative market sentiment. At the moment, the Dow Jones Industrial Average and the S&P 500 were both down around 0.18% on the day. If stock markets struggle to turn positive on the day, gold could find some demand as a safe-haven.
Later in the session, investors will be watching the 10-year T-bond auction, and there won't be any other macroeconomic data releases from the United States.
Technical outlook
Today's price action dragged the daily CCI indicator down to -100 area to suggest that the bearish pressure is building up. On the downside, supports could be seen at $1207 (daily low/Aug. 6 low) ahead of $1200 (psychological level) and $1194 (Mar. 10, 2017, low). On the upside, resistances are located at $1221 (20-DMA), $1234 (Jul. 25/26 high) and $1249 (50-DMA).