Daily Times

After closing the last week on a positive trajectory, gold price is likely to move sideways in the week starting today (Monday).

Gold price gained 2.04 percent on a weekly basis and surged to its highest level since early August to close at 1,817.80 per ounce last week due to heavy selling pressure surrounding the US dollar.

Meanwhile, the price of gold surged by 3.50 percent in Pakistan during the week, mainly due to depreciation of the rupee. The local currency depreciated by 0.88 percent against the US dollar during the week. The price of 10 grams of yellow metal in Pakistan was Rs94,000 at the opening of the last week and it increased to Rs97,300 to close the week.

The weaker greenback allowed gold to climb above $1,800 at the start of the week. However, gold struggled to clear the key resistance area that seems to have formed at $1,810 mid-week as investors moved to the sidelines while waiting for FOMC Chairman Jerome Powell’s speech at the Jackson Hole Symposium. Nevertheless, with the US dollar suffering heavy losses on Friday on Powell’s remarks, gold surged to its highest level since early August.

Meanwhile, the Relative Strength Index (RSI) indicator has climbed to 60, suggesting that there is more room on the upside before gold becomes technically overbought. The initial hurdle is located at $1,830 (static level) ahead of $1,845 (static level).

On the downside, $1,810 (100-day SMA, 200-day SMA) aligns as key support.