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Gold price keeps consolidating with the US Dollar depressed

Gold price (XAU/USD) keeps its positive bias intact on Friday’s early European session and is on track to a 2% weekly rally, fueled by the Federal Reserve’s (Fed) dovish pivot, which sent the US Dollar (USD) tumbling. Thursday’s data from the US confirmed that the labor market remains strong, and retail sales increased, offering some support for the Dollar. That said, investors remain confident that the Fed will be the first bigger central bank to start easing its monetary policy, which is keeping US Dollar bulls at bay.

Later today, the US preliminary S&P Global PMIs and the NY Empire State Manufacturing Index are expected to endorse the view of softer economic growth. This would allow the Fed to start rolling back its restrictive policy in early 2024, which is bad for the USD and might push Gold a tad higher. From a technical perspective, Gold is regaining bullish impetus following a strong rebound from the $1,970 on Wednesday. The pair, however, needs to breach the $2,040 resistance area to confirm the bullish view. Such a scenario is likely to attract buyers, with their focus on May’s peak at $2,070 before attempting another assault to the all-time high, at $2,150. On the contrary, failure to break the mentioned level would see price seek support at $2.015 – $2,020 area where the confluence of the 50 and 100 SMAs in 4-hour charts. Below here, bearish pressure would increase with the $1,977 support area coming into play.