Gold prices are largely unchanged in early Asia trading today as investors remained cautious ahead of key events such as the G7 summit and the Federal Open Market Committee meeting. XAU/USD retested the resistance in the $1302-$1300 area before pulling back to the $1296 level. The U.S. dollar index continued to weaken yesterday but world stock markets were mostly higher, limiting buying interest in the safe-haven gold.
The market’s inability to break through the 1302/0 zone suggests that prices will continue to oscillate around the 1296 level. XAU/USD is trading below the Ichimoku cloud on the M30 chart. The bottom of the hourly cloud sits in the 1296/5 area so the bears will have drag prices below there to test the intraday support at 1292.20. If this support is broken, the next stop will be 1290/89. A break below 1289 implies that the market is aiming for 1286.
To the upside, keep an eye on the 1302/0 barrier, which has stopped the bulls twice recently. If the market can successfully pass through, we may see a push up to 1307.50-1306. The bulls have to produce a daily close above 1307.50 to tackle 1311.
