Daily Price Outlook
Gold's price (XAU/USD) is holding firm around $1,970, continuing its upward trend for the third consecutive week.
As investors await key central bank statements from the US, Europe, and Japan, the precious metal maintains its recent highs, fueled by market consolidation, a light economic calendar, mixed catalysts, and pre-announcement uncertainty.
On the previous day, positive US job indicators and disappointing performances in the US oil and technology stocks led to an increase in US Treasury bond rates and the US Dollar. Additionally, doubts surrounding China's economic growth posed challenges for gold buyers.
However, the US Dollar's strength in preparation for the upcoming Fed meeting and the actions taken by officials to safeguard the Chinese economy triggered a corrective bounce in the XAU/USD price, halting a two-day losing streak.
Notably, apart from the positive employment data, most US figures have not been strong enough to support the Fed's announcement of further rate hikes beyond July in the upcoming week. This has deterred market bears and instilled optimism among gold investors.
Nevertheless, much depends on the US central bank's ability to defend the US Dollar and maintain its hawkish stance.
Gold (XAU/USD) Technical analysis
Gold prices closed below the level of $1977.25 yesterday, but they are currently consolidating above the intraday bullish channel. The presence of the EMA50 at this support level adds further strength to the consolidation.
Additionally, the stochastic indicator has reached the oversold areas and is showing positive overlapping signals.
Given these factors, we are inclined to suggest a bullish bias for the upcoming period. The initial targets are set at breaching $1977.25, which would reinforce the likelihood of the price heading towards $2000.00, followed by $2016.90 as the next positive milestones.
It's important to note that a break below $1967.40 would halt the expected rise and potentially lead to a decline in price.
The expected trading range for today is between the support level of $1960.00 and the resistance level of $1990.00.
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