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Gold has extended its bullish correction to the 38.2%$ ratio target and now has a chance of a deeper correction. Jackson Hole symposium is looming and signals by Jerome Powell are most awaited for direction and clues.
The dollar benefited from higher US yields following the demand from domestic and international buyers and this rally has supported the US dollar and weighed on gold prices.
The dollar recovered from a touch above 108 in early US session. Data on Wednesday showed that new orders for US-made capital goods increased at a slower pace in July from the prior month, suggesting that business spending on equipment may struggle to rebound.
US yields remained firm which ultimately lead to the price of the precious metal’s decline again and has enabled the dollar to recover some ground as the US session progresses.
The gold price is back to flat on the day as the US dollar comes back up for air. At the time of writing, XAU/USD is trading at $1,749 after falling from a high of $1,755.94. The precious metal has been as low as $1,742.51 on the day.
