The XAUUSD pair looks set to finish the week with modest gains after a solid bounce from four-month lows
Gold prices fell marginally on Thursday before regaining a modest upside bias ahead of the weekend. Earlier in the week, the precious metal encountered resistance in the $1,870 area to slip back towards the directionless 200-DMA that has been acting as the immediate support these days. On Friday, the bullion adds 0.43% on the day, flirting with the $1,855 zone during the early European hours.
The yellow metal struggles to find more robust demand even as the greenback continues to retreat across the market, challenging fresh one-month lows at the end of the week. The USD index failed to hold above the 102.00 figure and slipped below 101.50 earlier today before bouncing slightly.
In part, the upside momentum in the gold market is capped by a risk-on tone that dominates global financial markets today. After solid gains on Wall Street, Asian equities traded higher while European stocks opened in positive territory. However, the overall sentiment remains fragile and unstable as geopolitical and economic worries continue to persist globally, with inflation concerns remain elevated.
The XAUUSD pair looks set to finish the week with modest gains after a solid bounce from four-month lows during the previous week. Should the bullion exceed the $1,870 zone, the 20-week SMA, today at $1,890, will come back into the market focus for the first time in three weeks. The key near-term target for bulls remains at $1,900, but the metal is unlikely to overcome this barrier anytime soon.
On the downside, the bearish potential remains limited while above the mentioned 200-DMA, currently at $1,839. On the shorter-term timeframes, the technical picture looks quite upbeat, suggesting the prices could at least retain an upside bias in the immediate term.