Gold price (XAU/USD) action is correcting on Monday after sensing resistance above $1,960.00 as the robust performance of the United States in the April-June quarter reinforces the need for more interest-rate hikes from the Federal Reserve (Fed). The precious metal is under pressure as the US Dollar capitalizes on upbeat Gross Domestic Product (GDP) numbers and a robust Durable Goods Orders report.
United States factory activities have been contracting for the past eight months due to the aggressive rate-tightening cycle by the Federal Reserve (Fed). The manufacturing sector is broadly expected to continue reporting a vulnerable performance as firms struggle to tap credit due to the twin headwinds of higher interest rates by the Fed and tighter credit conditions among US regional banks.
Technical Analysis: Gold price looks supported above $1,950
Gold price remains sideways near the 20-day Exponential Moving Average (EMA) around $1.955.00 as investors shift their focus to factory activities and labor market data. On an hourly time frame, Gold price forms a bearish divergence that will be triggered after a breakdown below the crucial support of $1,940.00. An occurrence of the same would push the Gold price into a bearish trajectory.
