GOLD Price Analysis – April 06, 2023
Daily Price Outlook
Gold reached its highest level in a year on Wednesday, as recent US economic data fanned concerns about a downturn and raised anticipation that the Federal Reserve may ease up on rate hikes.
Gold Reaches Highest Level in a Year Amid Economic Slowdown Concerns
Spot gold was unchanged at $2,020.30 per ounce at 01:46 p.m. EDT (1746 GMT), after reaching a high of $2,031.89 in March 2022. Gold futures in the United States finished 0.1% lower at $2,035.60. After a significant decline in US job vacancies in February, gold jumped beyond the important $2,000 level on Tuesday, adding to gains earlier this week following an OPEC-led spike in oil that spurred fears of another inflation explosion.
Weaker US Data Boosts Bets on Federal Reserve Easing Rate Hikes
As financial tensions intensify, many anticipate gold will continue to surge above $2,000 per ounce. Gold prices will reach an all-time high and surpass $2,200 by the end of March 2024, according to UBS.
Analysts Predict Continued Growth for Gold Prices Above $2,000
Private payroll growth was worse than predicted in March, raising concerns about the economic implications of the Fed's quick rate hikes. Bullion benefited from a weaker currency as well as a drop in US yields.
Weaker Currency and Falling US Yields Support Bullion
"The market has shown some risk aversion as a result of yesterday's negative economic data, which is positive for safe-haven gold," said Jim Wyckoff, senior analyst at Kitco Metals. Traders believe that the possibility of a stop in US rate hikes in May is excellent news for zero-yield gold and its status as the go-to inflation hedge.
Market Awaits US Nonfarm Payroll Figures on Friday for Further Clues
Although a swift turnaround of Fed policy is improbable, Carsten Menke of Julius Baer's Next Generation indicated in a note that a US recession may still be avoided. Analysts anticipate that the market's reaction to the US nonfarm payroll numbers on Friday will be delayed until the following week due to the Good Friday holiday.
Gold (XAU/USD) – Technical Outlook
While maintaining its steadiness, the gold price approached our predicted target of $2,040.00 and witnessed a bearish bounce, testing the support base built above $2,010.00. Notably, the stochastic indicator is losing its bearish momentum, while the EMA50 continues to provide price support.
As a result, we anticipate favorable trading today, resuming the primary bullish trend within the chart's bullish channel. It's vital to remember that our goals range from $2,040.00 to $2,065.00. If the price falls below $2,010.00, it will be forced to test the bullish channel's support line at $1,975.00 before trying another advance.
The projected trading range for today is $2,005.00 support to $2,040.00 resistance.
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