Spot gold looking for its first weekly gain in three on weakening greenback

April 9, 2021 - 2 weeks ago
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The precious yellow metal looks to be polished up to its first weekly gain in over three weeks, as the greenback eases back on its recent bull-run.

The U.S. dollar, which measures the greenback strength against a basket of major currencies, fell to a two-week low after the number of Americans filing new unemployment claims increased for the second straight week last week.

The number of Americans applying for unemployment benefits rose +2.2% to 744,000 last week, signalling that many employers are still cutting jobs even as more people are vaccinated against COVID-19.

U.S. Treasury yields fell on Thursday, pressured by new dovish comments from Federal Reserve Chair Jerome Powell.

He also noted that an expected rise in prices this year is likely to be temporary and warned that an uptick in COVID-19 cases could slow the recovery.

U.S. Treasury Secretary Janet Yellen on Thursday encouraged major economies to add substantial new fiscal stimulus to ensure a robust recovery.

Viewing the technical standpoint for the Relative Strength Index (RSI), 3-daily ‘lookback’ indicator holds above the 50-midway point, which supports a positive signal, along with the Moving Average Convergence Divergence (MACD).

The ADX indicator is bullish (in trend). With the upside target at $1,752-54 reached, now views an extension to $1,760-65. Reassess from there.

Only a close beneath $1,719-22 would potentially negate the upside call and reinstate the $1,680 call.

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