Technical Analysis

GOLD Price Analysis – March 09, 2023

By LonghornFX Technical Analysis
Mar 9, 20233 min

Daily Price Outlook

The price of gold, XAU/USD, is currently trading at $1,814.99 and remaining stable as traders await the release of United States jobs data. On Wednesday, Federal Reserve Chair Powell addressed the House Financial Services Committee and emphasized the Fed's reliance on data. Powell also stated that the

Repetitive Remarks of Federal Reserve Chairman

Fed had underestimated the resilience of GDP and inflation, supporting the central bank's hawkish stance. As a result, market participants anticipate a 50 basis point rate increase in March, compared to the 0.25% forecasted last week.

Following the hawkish comments made by Fed Chair Powell, the US dollar gained strength against other major currencies and is currently trading at 105.58. Additionally, the yield on the 10-year bond rose to 3.991%.

The price of gold bounced back from a low of one week but didn't show much activity as Powell repeated his hawkish stance in front of the House Financial Service Committee.

US Economy and Gold: How Economic Data Impacts the Price of Gold

Positive economic data from the US has resulted in downward pressure on the XAU/USD market, despite repeated remarks from Fed Chair Powell offering relief to gold traders.

On Wednesday, the US ADP Employment Change rose to 242K in February, exceeding expectations of 200K and the revised figure of 119K for the previous period.

Additionally, the US JOLTS Job Openings for January increased to 10.824M, surpassing the expected 10.6M but lower than the previous 11.234M.

However, the lack of a significant surprise for the market and the cautious sentiments ahead of Friday's important United States jobs data contributes to the most recent inactivity of Gold.

US to Lift COVID-19 Travel Restrictions for Chinese Travelers

On Wednesday, China called for the normalization of cross-border travel, as the US is reportedly looking to ease COVID-19 testing restrictions for Chinese tourists. Additionally, the US has adopted a relaxed schedule and lifted testing requirements for tourists from China in a bid to boost trade.

Looking forward, the Producer Price Index (PPI) for February and the monthly Consumer Price Index (CPI) for China is expected to impact gold prices.

 Gold Price Chart - Source: Tradingview

Gold (XAU/USD) Intraday Technical Levels

Support      Resistance

1809            1823

1802            1831

1794            1838

Pivot Point: 1816

Gold (XAU/USD) – Technical Outlook

After briefly showing bullish movement around the $1828.70 level, gold prices have since reversed and continued their downward trend, currently within the depicted bearish channel on the chart, with a target of $1788.20. Due to the prior level break, the EMA50's negative pressure on the price supports the continuation of this anticipated decline.

However, a potential stop to the bearish scenario and a likely attempt at recovery with an initial target of $1878.80 could occur if the price breaks above $1828.70 and $1843.70. The expected trading range for the day is between the support level of $1790.00 and the resistance level of $1825.00.



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