GOLD Price Analysis – June 19, 2023

Daily Price Outlook

As the new week kicks off, the price of gold is taking a little dip and showing a slight negative bias, grooving just below the $1,955 mark ahead of the European session.

This dance move comes as the US Dollar (USD) takes the spotlight, benefiting from the Federal Reserve’s (Fed’s) recent suggestion that borrowing costs might need to climb up to 50 basis points (bps) by the year’s end.

The USD is gaining momentum for the second consecutive day, with the USD Index (DXY) trying to build on its Friday recovery from a month-long low. This upbeat performance puts some pressure on gold, denominated in US dollars and tends to move inversely to the USD.

But that’s not all, folks! The gold party faces more skeptics as major central banks strike a more cautious tone. The Reserve Bank of Australia (RBA) and the Bank of Canada (BoC) unexpectedly raised interest rates by 25 basis points this month, shaking up the dance floor.

And guess what? The European Central Bank (ECB) joined the dance party by increasing rates by 25 basis points, the most in 22 years! They expect these rate hikes to tame inflation and keep future moves in check.

So, while gold takes a little dip and does some fancy footwork, it’s essential to keep an eye on the USD and those central banks’ moves. Will gold find its rhythm and make a comeback, or will it continue its smooth slide?

Stay tuned to see how this dance unfolds and impacts the gold price.

GOLD Price Chart – Source: Tradingview

Gold – Technical Analysis

Gold prices have returned to their downward trajectory after a temporary uptick in recent sessions. The market is now hovering around the EMA50, anticipating further declines with an initial test of $1,945.20.

It’s worth noting that a breakthrough at this level would pave the way for a visit to the next correctional level at $1,913.15.

The current positivity in the Stochastic indicator explains the current sideways movement, awaiting a shift to negative momentum that would support the resumption of the expected bearish wave.

However, if the price manages to breach $1,977.25, it would halt the correctional bearish trend and potentially set the stage for a recovery towards the main bullish trend.

In terms of today’s expected trading range, support is anticipated around $1,935.00, while resistance is projected at $1,970.00.