GOLD Analysis – December 16, 2021

Gold’s Daily Price Analysis

Gold prices were closed at $1780.20 after setting a high of $1782.05 and a low of $1753.70. During early trading hours, gold dropped to its lowest since October 6th on Wednesday, but in late trading hours, it found some support and started rising after the US retail sales data release.

The US Dollar Index rose to 96.91, its highest since November 24th, during early trading hours on Wednesday. However, the greenback started declining during the American trading session and reached 96.51 after the US retail sales data against the currency.

At 18:30 GMT, Core Retail Sales fell to 0.3% from 0.9% expected, weighing on the greenback on the data front. Retail sales in November fell to 0.3% versus a forecasted 0.8%, weighing on the US dollar. The Empire State Manufacturing Index surged to 31.9 against the anticipated 24.9 and supported the US dollar. Import prices also advanced to 0.7% against the projected 0.5% and supported the US dollar.

At 20:00 GMT, business inventories increased by 1.2% against the expected 1.0% and weighed on the dollar. The NAHB Housing Market Index remained flat with an expectation of 84. Most of the data released on Wednesday was unfavourable for the US dollar, which helped gold strengthen in the market.

Meanwhile, the US central bank signalled that its inflation target had been met on Wednesday, which has paved the way for about three interest rate hikes next year. The Federal Reserve has said that it will cut back its stimulus program more quickly than planned due to rising inflation.

The Federal Reserve had already announced that it was tapering off the monthly support introduced to bolster the economy during the pandemic. However, on Wednesday, the officials said that the process would be speeded up and that the stimulus would end by March. This news should have had a negative impact on the precious metal, but the initial reaction came against the US dollar as it was highly expected, and markets had already priced this move.

GOLD Intraday Technical Level

Support Resistance

1751.24 1779.54

1737.97 1794.57

1722.94 1807.84

Pivot Point: 1766.27

GOLD - Technical Outlook

Gold is trading with a slight bullish bias at $1,782 per ounce. On the bullish side, the precious metal gold’s significant resistance stays at 1,787, and an uptrend can expose its price towards the 1,796 level.

On the lower side, gold is gaining immediate support at 1,780, and a break below this level exposes the metal towards the 1,770 pivot point support level. The RSI and MACD are in the overbought zone; however, the recent candles support an uptrend. A surge in bullish pressure dominates an uptrend above 1,780 and vice versa. Good luck!