Global Markets – Gold experienced a downward correction, falling below $2,265.73, erasing most of its daily gains. The benchmark 10-year US T-bond yield surged over 2.92% to above 4.3%, hindering XAU/USD from regaining traction. The retreat follows a record high of $2,265.73 per troy ounce earlier in the day, with XAU/USD rallying during Asian trading hours before reversing course during European trading.

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The US Dollar strengthened after the release of better-than-expected United States (US) ISM Manufacturing PMI data. The report indicated expansion in the manufacturing sector for March, ending 16 consecutive months of contraction. The index rose to 50.3 from 47.8 in February.

GOLD SURGES BY RS2,800, HITS RS237,600 PER TOLA

US Economic Data and Market Reaction – S&P Global’s final estimate of its Manufacturing PMI confirmed expansionary levels at 51.9, slightly below expectations but still positive. Improvements in economic conditions and market demand led to a further expansion of US manufacturing production, reaching a 22-month high. However, Wall Street turned negative, with the Dow Jones Industrial Average down over 200 points in late reaction to events from the extended weekend.

Federal Reserve (Fed) Chairman Jerome Powell reiterated in an interview that the Fed is not rushing to cut rates, citing strong economic growth and inflation above target.

Technical Outlook for XAU/USD – On the daily chart, XAU/USD filled an opening gap and bounced back, maintaining bullish moving averages. However, technical indicators lost upward momentum while remaining positive. The Relative Strength Index (RSI) consolidates around 76, indicating bullish sentiment.

In the short term, spot gold corrects near-term overbought conditions. On the 4-hour chart, technical indicators retreated sharply but remain above midlines. Moving averages offer dynamic support around $2,208.05.

Key Levels for XAU/USD:

  • Support: 2,228.40, 2,208.05, 2,184.70
  • Resistance: 2,250.00, 2,265.60, 2,280.00

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