• Gold price takes offers to renew intraday low, prints the first daily loss in three.
• Hawkish Fedspeak, expectations of higher rates from major central banks underpin DXY rebound.
• Risk catalysts, second-tier US data may entertain traders, bond market moves are the key.

Gold price (XAU/USD) renews its intraday low around $1,645 while diverging from the early-week rebound heading into the European session on Wednesday. In doing so, the precious metal justifies the US dollar’s latest upswing amid a sluggish session and light calendar ahead of the key inflation data from the UK, Eurozone and Canada.

The US Dollar Index (DXY) picks up bids while tracking the recently firmer US Treasury yields. That said, the US 10-year Treasury yields added two basis points (bps) near the 4.02% mark at the latest.

It should be noted that the market’s inaction could be linked to the lack of major data/events, as well as mixed catalysts surrounding China and Russia. The recently mixed covid numbers from China join Russia’s strong fight in Ukraine to challenge the sentiment. However, upbeat earnings and hopes of more stimulus from Beijing, Tokyo and the Eurozone keep the riskier assets firmer. On the same line could be the UK’s optimism due to the recent U-turn from the fiscal policies.

Additionally, hawkish Fed bets also weigh on the XAU/USD prices as the CME’s FedWatch Tool signals that markets are pricing in a nearly 95% chance of the Fed’s 75 rate hike in November.

Even so, the upbeat performance of equities and the stock futures joins the hopes of upbeat gold demand, as per the latest industry survey, challenging the gold sellers.

Moving on, firmer inflation data from the key economies may exert downside pressure on precious metal prices. However, major attention will be given to the US bond market’s move for clear directions.

Technical analysis

Gold bears jostle with a three-week-old support line near $1,644, quickly followed by a monthly horizontal support area surrounding $1,640.

In doing so, the XAU/USD sellers track downbeat MACD and RSI, as well as the quote’s sustained trading below a downward sloping resistance line from September 07, around $1,653 by the press time.

Also favoring the metal sellers is the price momentum below the 200-HMA, around $1,669 at the latest.

Meanwhile, a downside break of $1,640 will quickly drag the metal toward the yearly low near $1,615 before highlighting the $1,600 for the bears.

Gold: Hourly chart

Trend: Further weakness expected