GOLD Price Analysis – March 20, 2024
Daily Price Outlook
Gold prices have been facing challenges in gaining momentum recently and remained under pressure near a one-week low. However, the primary reasons for this downward trend is the strengthening of the US dollar, which has been underpinned by hawkish expectations surrounding the Federal Reserve (Fed). The Fed's indication of maintaining higher interest rates for an extended period has boosted confidence in the US currency, thereby keeping the precious metal price down.
Traders in the gold market appear hesitant to make aggressive moves, particularly ahead of the Federal Open Market Committee (FOMC) decision. Additionally, geopolitical risks, such as the ongoing conflict between Russia and Ukraine, provide some support for gold but are not sufficient to offset the broader downward pressure.
Impact of Robust US Inflation Figures on Gold Price
On the US front, the release of strong consumer and producer inflation figures in the United States last week has fueled speculation that the Federal Reserve will maintain its stance of higher interest rates for a prolonged period. This expectation has contributed to elevated US Treasury bond yields, which in turn support the US dollar and dampen demand for gold.
Historically, gold prices tend to move inversely to the US dollar, as investors often flock to the precious metal as a hedge against inflation and currency depreciation. However, the current environment of anticipated rate hikes diminishes gold's attractiveness as an alternative investment.
Investors are closely monitoring the Fed's monetary policy decisions, particularly the updated economic projections and comments from Fed Chair Jerome Powell. Any indications of a more hawkish approach to tightening monetary policy could further weigh on gold prices. Conversely, a dovish tone from the Fed could provide some relief for gold bulls, although the impact may be limited given the market sentiment.
Positive Risk Tone and Its Impact on Gold Price
Despite lingering geopolitical tensions, a generally positive risk tone in financial markets has contributed to downward pressure on gold prices. Wall Street's bullish performance, with the S&P 500 reaching record highs, reflects investor confidence and reduces the appeal of safe-haven assets like gold. The optimistic outlook is bolstered by expectations of continued economic recovery and progress in resolving global conflicts.
Traders are adopting a cautious approach, awaiting clarity on the Fed's rate-cut path before committing to significant positions in the gold market. The outcome of the FOMC meeting, including the "dot plot" indicating future interest rate expectations, will be closely scrutinized for cues on the direction of gold prices. Additionally, Jerome Powell's remarks during the post-meeting press conference could introduce volatility in financial markets and influence gold's trajectory in the short term.
GOLD (XAU/USD) - Technical Analysis
In today's technical outlook, GOLD's price shows a slight uptick, registering at $2159.165, marking a 0.07% increase. Analyzing the 4-hour chart, GOLD has approached key levels that signal potential future movements. The pivot point stands at $2153.10, acting as a reference for the session's bias.
Considering the current setup, the overall trend for GOLD seems cautiously optimistic, with a bias towards bullishness above the $2155 mark. Investors are advised to monitor these levels closely, as a decisive break could dictate the short-term direction. Entry is recommended above $2155, with a take profit target set at $2165 and a stop loss at $2150, to manage risk effectively.
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GOLD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Gold price slightly down at $2158.57, trading near critical resistance at $2163 with potential bearish bias.
- Technical indicators show neutral to slight bearish sentiment, with RSI at 47 and close alignment with the 50-day EMA.
- Advised cautious sell position below $2162, aiming for $2152 with a stop loss at $2168, as market evaluates further direction.
Gold's price experienced a marginal decrease, trading at $2158.57, down by 0.01%. The precious metal is hovering around pivotal levels as traders and investors gauge market directions amidst fluctuating global economic cues. With a current pivot point at $2163, gold faces immediate resistance at $2169, followed by higher resistance levels at $2176 and $2184. On the downside, support is found at $2153, with further cushions at $2147 and $2139, indicating potential floors for price retracements.
The RSI indicator stands at 47, suggesting a neutral to slightly bearish sentiment among market participants. The 50-day Exponential Moving Average (EMA), positioned at $2153, is closely aligned with the current price, offering a potential support zone that could influence short-term price movements.
A downward trendline extending resistance near the $2160 level hints at a bearish bias below this mark. Investors might consider this a cue for potential sell trades, should the price fail to breach the $2162 resistance. Given the current technical setup, a cautious approach is advised, with a recommended entry price for selling below $2162, targeting a take profit at $2152, and setting a stop loss at $2168. This cautious stance reflects the market's ongoing evaluation of gold's value as it navigates through various economic indicators and geopolitical developments.
GOLD (XAU/USD) - Trade Ideas
Entry Price – Sell Below 2162
Take Profit – 2152
Stop Loss – 2168
Risk to Reward – 1: 1.6
Profit & Loss Per Standard Lot = +$1000/ -$600
Profit & Loss Per Mini Lot = +$100/ -$60
GOLD Price Analysis – March 19, 2024
Daily Price Outlook
Gold price has been facing downward pressure and maintaining a bearish trajectory near the 2,150 level over the past four days. This decline is attributed to the hawkish feds outlook mainly because investors believe the Federal Reserve will keep interest rates high, making the US dollar stronger. However, the recent release of robust inflation data has reinforced this expectation, strengthening the conviction that the Fed will maintain its current monetary policy stance.
Moreover, the geopolitical tensions such as the ongoing Russia-Ukraine conflict and disturbances in the Middle East have emerged as potential catalysts for supporting gold prices. Investors often turn to gold as a safe-haven asset during periods of heightened uncertainty.
Impact of US Economic Indicators on Gold and the Dollar
On the US front, the recent rise in inflation in the US suggests that the Federal Reserve might keep interest rates high for longer. This makes the US dollar stronger but lowers the price of gold. Investors are expecting fewer interest rate cuts from the Federal Reserve this year, with a 51% chance of a rate cut in June. Thereby, the lower interest rates usually make a currency less appealing to investors, which could limit gains for the US dollar. On the flip side, this could help gold prices because they often rise when the dollar weakens.
Geopolitical Conflicts and Their Impact on Gold Prices
On the geopolitical front, the ongoing conflicts like the Russia-Ukraine war and Middle East disputes make investors worried, so they invest in safe options like gold, increasing its demand and price. This uncertainty can also cause shifts in other financial markets, further boosting gold prices. Ukraine increased drone attacks on Russian oil refineries, and Israeli Prime Minister Benjamin Netanyahu announced intentions to enter Gaza's Rafah area. These actions add to global uncertainty, affecting oil markets and regional stability.
GOLD (XAU/USD) - Technical Analysis
Gold's price experienced a marginal decrease, trading at $2158.57, down by 0.01%. The precious metal is hovering around pivotal levels as traders and investors gauge market directions amidst fluctuating global economic cues. With a current pivot point at $2163, gold faces immediate resistance at $2169, followed by higher resistance levels at $2176 and $2184. On the downside, support is found at $2153, with further cushions at $2147 and $2139, indicating potential floors for price retracements.
The RSI indicator stands at 47, suggesting a neutral to slightly bearish sentiment among market participants. The 50-day Exponential Moving Average (EMA), positioned at $2153, is closely aligned with the current price, offering a potential support zone that could influence short-term price movements.
A downward trendline extending resistance near the $2160 level hints at a bearish bias below this mark. Investors might consider this a cue for potential sell trades, should the price fail to breach the $2162 resistance. Given the current technical setup, a cautious approach is advised, with a recommended entry price for selling below $2162, targeting a take profit at $2152, and setting a stop loss at $2168. This cautious stance reflects the market's ongoing evaluation of gold's value as it navigates through various economic indicators and geopolitical developments.
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GOLD Price Analysis – March 18, 2024
Daily Price Outlook
Gold price (XAU/USD) failed to stop its previous three-day bearish rally and remained well offered around the 2,147 level. However, the downward trend can be associated with increasing expectations that the Fed will keep interest rates higher for longer, which continues to underpin the US dollar and contributes to gold losses. It is worth recalling that previously released stronger inflation data fueled speculation that the Federal Reserve would keep interest rates high for a longer time. In contrast, geopolitical tensions such as the Russia-Ukraine war and conflicts in the Middle East can support gold prices amid ongoing losses by increasing demand for the precious metal as a safe-haven asset.
Impact of US Economic Indicators on Gold and the Dollar
As we mentioned above that the previously released stronger inflation data reinforced hawkish outlook, suggesting an increase in interest rates to control inflation. Hence, the stronger inflation data and the possibility of the Federal Reserve maintaining higher interest rates underpinned the US dollar and had a negative impact on the gold price. Despite some stability in inflation expectations, the University of Michigan's survey showed a slight decrease in consumer sentiment.
Besides this, the CME Group's FedWatch Tool suggests a 60% chance of an interest rate cut in June, which dampens the US dollar as lower interest rates typically weaken a currency by making it less attractive to investors seeking higher yields. This could provide some support to the gold price due to its inverse relationship with the dollar.
Geopolitical Conflicts and Their Impact on Gold Prices
On the geopolitical front, the ongoing conflicts such as the Russia-Ukraine war and Middle East disputes are impacting gold prices. These uncertainties lead investors to choose safe-haven assets like gold, increasing its demand and price. Additionally, geopolitical tensions can affect other markets, causing investors to move investments to gold, further raising its price.
However, Ukraine's strikes on Russian oil refineries and Israel's actions in Gaza impacts commodity supply, raising prices and inflation concerns. This can increase demand for gold as a hedge against these risks, ultimately driving up gold prices.
GOLD (XAU/USD) - Technical Analysis
On March 18, Gold (XAU/USD) witnessed a slight decline of 0.38%, with the price settling at $2146.975. This movement occurred within a context where the precious metal's price dynamics have been keenly observed by traders seeking to navigate its short-term volatility against a backdrop of broader economic signals.
The technical landscape for gold reveals a nuanced picture. The pivot point stands at $2135, with immediate resistance levels identified at $2167, followed by $2176 and $2187. Conversely, the metal finds support at $2140, with subsequent levels at $2130 and $2119. This configuration suggests a battleground where $2150 emerges as a critical juncture; moving below this level might signal a bearish turn, while holding above it could indicate sustained bullish momentum.
Technical indicators add layers to this analysis. The Relative Strength Index (RSI) at 35 hints at a market that is edging towards being oversold, potentially setting the stage for a rebound. However, the presence of a bearish engulfing candle on the daily timeframe complicates this scenario, introducing the possibility of a downward correction. Meanwhile, the 50-Day Exponential Moving Average (EMA) at $2163, in conjunction with an upward channel on the 4-hour timeframe, generally supports a buying trend.
In conclusion, while the immediate trend for gold seems to favor buyers, especially within the upward channel, the recent bearish patterns observed warrant caution. Traders might consider a strategy of selling below $2150, with a take profit at $2135 and a stop loss also at $2135, carefully navigating the potential for a downward correction while remaining alert to the metal's broader bullish underpinnings.
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GOLD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Gold's current technical setup suggests a delicate balance between bullish momentum and the risk of a downward correction.
- The RSI and 50 EMA indicators generally support a buying trend, yet recent bearish signals caution against potential declines.
- A strategic approach involves selling below $2150, targeting profits at $2135, with a vigilant eye on changing market dynamics.
On March 18, Gold (XAU/USD) witnessed a slight decline of 0.38%, with the price settling at $2146.975. This movement occurred within a context where the precious metal's price dynamics have been keenly observed by traders seeking to navigate its short-term volatility against a backdrop of broader economic signals.
The technical landscape for gold reveals a nuanced picture. The pivot point stands at $2135, with immediate resistance levels identified at $2167, followed by $2176 and $2187. Conversely, the metal finds support at $2140, with subsequent levels at $2130 and $2119. This configuration suggests a battleground where $2150 emerges as a critical juncture; moving below this level might signal a bearish turn, while holding above it could indicate sustained bullish momentum.
Technical indicators add layers to this analysis. The Relative Strength Index (RSI) at 35 hints at a market that is edging towards being oversold, potentially setting the stage for a rebound. However, the presence of a bearish engulfing candle on the daily timeframe complicates this scenario, introducing the possibility of a downward correction. Meanwhile, the 50-Day Exponential Moving Average (EMA) at $2163, in conjunction with an upward channel on the 4-hour timeframe, generally supports a buying trend.
In conclusion, while the immediate trend for gold seems to favor buyers, especially within the upward channel, the recent bearish patterns observed warrant caution. Traders might consider a strategy of selling below $2150, with a take profit at $2135 and a stop loss also at $2135, carefully navigating the potential for a downward correction while remaining alert to the metal's broader bullish underpinnings.
GOLD (XAU/USD) - Trade Ideas
Entry Price – Sell Below 2150
Take Profit – 2135
Stop Loss – 2135
Risk to Reward – 1: 1.25
Profit & Loss Per Standard Lot = +$1500/ -$120
Profit & Loss Per Mini Lot = +$150/ -$120
GOLD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Gold’s modest rise to $2165.285 underscores cautious optimism among investors.
- Key resistances at $2181, $2200, and $2219 mark potential ceilings for price gains.
- RSI and 50 EMA indicate a balanced market, tilting slightly towards bullish momentum.
On March 15, Gold witnessed a slight increase in its value, ticking up by 0.22% to $2165.285, a move reflecting a nuanced investor approach towards the precious metal amidst fluctuating market conditions. Positioned just below a pivotal $2178 mark, the price dynamics suggest a crucial juncture where the future direction could be determined.
Resistance levels are closely watched at $2181, extending to $2200 and $2219, which could potentially cap gains if the bullish momentum sustains. Conversely, the metal finds its immediate support at $2141, with further layers at $2125 and $2111, essential for halting any downward pressures. The trading indicators offer a mixed yet slightly optimistic narrative; the Relative Strength Index (RSI) at 51 hints at a balanced market sentiment with a lean towards buying, while the 50-day Exponential Moving Average (EMA) at $2150 serves as a critical support level, underpinning the potential for an upward trajectory.
The current technical outlook posits a guarded yet positive scenario for gold, recommending a buying strategy above $2153 to capitalize on potential upticks towards the pivot level. A take-profit point is advised at $2178, aligning with near resistance, to secure gains from anticipated movements. Conversely, a stop-loss order at $2140 is prudent, safeguarding against unexpected market reversals.
GOLD (XAU/USD) - Trade Ideas
Entry Price – Buy Above 2153
Take Profit – 2178
Stop Loss – 2140
Risk to Reward – 1: 1.9
Profit & Loss Per Standard Lot = +$2500/ -$1300
Profit & Loss Per Mini Lot = +$250/ -$130
GOLD Price Analysis – March 15, 2024
Daily Price Outlook
On Friday, Gold (XAU/USD) witnessed a rebound, nearly recouping losses from the prior day, as it approached the $2,150 mark. Despite this resurgence, gold's trading range has been consistent since the week's start, as the market awaits further clarity on the Federal Reserve's potential rate adjustments. The focus is squarely on the forthcoming FOMC policy meeting slated for the upcoming Tuesday.
Anticipation of Fed's Monetary Policy Stirs Market Speculation
Recent data revealing a spike in the US Producer Price Index (PPI) has sparked debates over the Fed's timing on interest rate modifications, suggesting potential delays. Nonetheless, market sentiment still leans towards an anticipated rate cut by the Fed in June, buoyed by a dip in US Treasury yields, offering some reprieve to gold's non-yielding nature. However, a slight rise in the US Dollar could temper significant gains for the metal.
Key Economic Indicators and Their Impact on Gold Prices
Investors are gearing up for the release of crucial US economic indicators, including the Empire State Manufacturing Index, Industrial Production, and the Prelim Michigan Consumer Sentiment Index. These data points, along with US bond yield movements, are expected to shape the dollar's trajectory, influencing gold's value. Moreover, global risk sentiment is likely to generate short-term trading avenues for gold, although XAU/USD appears on the verge of concluding a three-week ascension, deviating from a record high achieved the previous Friday.
Economic Data Highlights and Market Reactions
Thursday's announcement indicated a higher-than-anticipated rise in US producer prices for February, potentially prompting the Fed to sustain elevated interest rates, impacting gold prices negatively. The Labor Department's reports on Initial Jobless Claims and Retail Sales further nuanced market perspectives, emphasizing a consumer spending slowdown amidst inflationary pressures. Despite this, there's a 60% probability, as per the CME Group's FedWatch Tool, of a rate cut in June, offering some stability to gold prices. The geopolitical tension, marked by Russia's tactical movements, alongside the awaited US economic data and the upcoming FOMC meeting, remains crucial in determining gold's short-term direction.
GOLD (XAU/USD) - Technical Analysis
On March 15, Gold witnessed a slight increase in its value, ticking up by 0.22% to $2165.285, a move reflecting a nuanced investor approach towards the precious metal amidst fluctuating market conditions. Positioned just below a pivotal $2178 mark, the price dynamics suggest a crucial juncture where the future direction could be determined.
Resistance levels are closely watched at $2181, extending to $2200 and $2219, which could potentially cap gains if the bullish momentum sustains. Conversely, the metal finds its immediate support at $2141, with further layers at $2125 and $2111, essential for halting any downward pressures. The trading indicators offer a mixed yet slightly optimistic narrative; the Relative Strength Index (RSI) at 51 hints at a balanced market sentiment with a lean towards buying, while the 50-day Exponential Moving Average (EMA) at $2150 serves as a critical support level, underpinning the potential for an upward trajectory.
The current technical outlook posits a guarded yet positive scenario for gold, recommending a buying strategy above $2153 to capitalize on potential upticks towards the pivot level. A take-profit point is advised at $2178, aligning with near resistance, to secure gains from anticipated movements. Conversely, a stop-loss order at $2140 is prudent, safeguarding against unexpected market reversals.
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GOLD Price Analysis – March 14, 2024
Daily Price Outlook
Despite increasing geopolitical tensions in the Middle East, the price of gold (XAU/USD) failed to extend its previous gains and turned bearish around below the $2,165 mark. This bearish trend can be attributed to the Fed's hawkish outlook, which tends to support the US dollar and contributing to gold's losses. The Federal Reserve might delay interest rate cuts due to high inflation in the US, as rising inflation often leads central banks to avoid lowering rates to prevent further inflationary pressure.
Apart from this, the current market mood favoring riskier investments has pushed down gold prices. Investors are opting for assets with higher potential returns rather than safer options like gold, causing its prices to drop. However, this trend might not last long. If tensions increase in the Middle East, demand for safe-haven assets like gold could rise again, leading to a rebound in its price. Additionally, uncertainty about the Federal Reserve's future interest rate decisions could also prevent gold prices from falling significantly lower.
Impact of High Inflation on the US Economy and Financial Markets
On the US front, the broad-based US dollar got stronger because people think the Federal Reserve might not cut interest rates soon. This is because a recent report showed that prices are going up in the US, meaning inflation is staying high. When inflation is high, the Fed might not want to lower interest rates because that could make inflation even higher. The expectation of delayed interest rate cuts by the Federal Reserve, due to high inflation, led to a stronger dollar and limited upward movement in gold prices.
On the data front, the latest US Consumer Price Index (CPI) report indicated a slight increase in inflation, with February's year-over-year rise at 3.2%, slightly higher than expected. The Core CPI, which excludes volatile food and energy prices, was also higher than anticipated at 3.8%. This suggests that inflation is going up, which can impact how much people can buy and the overall economy.
Impact of Risk-On Market Sentiment on Gold Prices
On the other hand, the risk-on-market sentiment has played a major role in undermining the safe-haven gold price as investors may prefer riskier assets over safe havens like gold, reducing its appeal and leading to price declines. However, the risk-on market sentiment was backed by the upbeat US inflation data and Fed's hawkish outlook, which positively impacts market sentiment by signaling confidence in the economy, leading to increased investment and a stronger dollar.
Geopolitical Tensions Drive Interest in Gold
On the geopolitical front, investors are expressing ongoing worries about the potential fallout from the prolonged conflicts between Russia and Ukraine, as well as the Israel-Hamas tension. These concerns are driving interest in precious metals like gold, which are traditionally seen as safe-haven assets during times of uncertainty. Russian President Vladimir Putin's recent remarks, suggesting readiness for a nuclear war if the US were to send troops to Ukraine, have escalated tensions further. Meanwhile, in the Middle East, Israeli attacks on locations including a UN aid distribution center in Rafah and Hezbollah fighters in the Bekaa Valley are exacerbating regional instability.
Therefore, the ongoing conflicts between Russia and Ukraine, along with tensions in the Middle East, are driving interest in gold as a safe-haven asset as geopolitical instability typically increases demand for gold, which could lead to an increase in its price.
GOLD (XAU/USD) - Technical Analysis
On March 14, gold experienced a slight decline, closing at $2,168.425, marking a 0.29% drop. This movement occurred amid mixed signals from technical indicators and key price levels that offer insights into potential future movements.
The pivot point for gold stands at $2,178, acting as a critical threshold for determining the metal's short-term direction. Resistance levels are mapped out at $2,197, $2,219, and $2,244, indicating potential points where upward momentum might face obstacles. Conversely, support levels are identified at $2,151, $2,131, and $2,111, which could provide floors for price dips.
Technical indicators present a nuanced view. The Relative Strength Index (RSI) at 54 suggests a neutral to slightly bullish sentiment among traders. Meanwhile, the 50-day Exponential Moving Average (EMA) at $2,146 supports an underlying upward trend. However, a double top formation near the $2,178 mark and a bearish engulfing candlestick pattern on the 4-hour timeframe signal caution, indicating possible selling pressure ahead.
Given these dynamics, the overall trend leans towards a cautious bearish outlook in the immediate term. Traders might consider a selling strategy below $2,177, targeting a take-profit level at $2,150, with a stop loss set at $2,196 to manage risk.
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GOLD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Gold's decline to $2,168.425 suggests a cautious market, with key resistance at $2,197 and support at $2,151 guiding short-term movements.
- Mixed technical signals: RSI at 54 and upward EMA trend contrast with a double top and bearish patterns, hinting at potential selling pressure.
- Recommended strategy involves selling below $2,177, with a profit target at $2,150 and a stop loss at $2,196, based on current technical indicators.
On March 14, gold experienced a slight decline, closing at $2,168.425, marking a 0.29% drop. This movement occurred amid mixed signals from technical indicators and key price levels that offer insights into potential future movements.
The pivot point for gold stands at $2,178, acting as a critical threshold for determining the metal's short-term direction. Resistance levels are mapped out at $2,197, $2,219, and $2,244, indicating potential points where upward momentum might face obstacles. Conversely, support levels are identified at $2,151, $2,131, and $2,111, which could provide floors for price dips.
Technical indicators present a nuanced view. The Relative Strength Index (RSI) at 54 suggests a neutral to slightly bullish sentiment among traders. Meanwhile, the 50-day Exponential Moving Average (EMA) at $2,146 supports an underlying upward trend. However, a double top formation near the $2,178 mark and a bearish engulfing candlestick pattern on the 4-hour timeframe signal caution, indicating possible selling pressure ahead.
Given these dynamics, the overall trend leans towards a cautious bearish outlook in the immediate term. Traders might consider a selling strategy below $2,177, targeting a take-profit level at $2,150, with a stop loss set at $2,196 to manage risk.
GOLD (XAU/USD) - Trade Ideas
Entry Price – Sell Below 2177
Take Profit – 2150
Stop Loss – 2196
Risk to Reward – 1: 1.4
Profit & Loss Per Standard Lot = +$2700/ -$1900
Profit & Loss Per Mini Lot = +$270/ -$190
GOLD Price Analysis – March 13, 2024
Daily Price Outlook
Despite the warmer US CPI report, indicating an increase in consumer prices, the price of gold (XAU/USD) continued to rise and remained steady above the $2,160 level. This upward trend was driven by the weakening US dollar, which did not strengthen even as US Treasury bond yields increased following the slightly higher-than-expected US consumer inflation for February. However, this lack of dollar strength could be attributed to the increasing belief among market participants that the Federal Reserve (Fed) will begin cutting interest rates at its June policy meeting.
In addition to this, the risk-off market sentiment, pressured by geopolitical risks, was seen as another key factor that provided support to the safe-haven gold. Meanwhile, cautious sentiment continue in the market ahead of the highly anticipated two-day FOMC monetary policy meeting starting next Tuesday. This keeps investors cautious, leading them to invest in gold as a safe-haven asset.
US Dollar Remains Weak Despite Inflation Report; Fed Rate Cut Speculation Grows
Despite the hot US inflation report, which fueled speculations that the Federal Reserve may delay interest rate cuts, the broad-based US dollar failed to gain much support and remained under pressure on the day. This is due to the growing acceptance that the Federal Reserve (Fed) will start cutting interest rates at the June policy meeting. According to the CME Group's FedWatch tool, there's about a 70% chance that the US central bank will lower interest rates at its June meeting, as per market expectations.
On the data front, the latest report on the US Consumer Price Index (CPI) shows a 3.2% year-over-year increase in February, slightly higher than the expected 3.1%. This indicates a slight uptick in inflation. Additionally, the annual Core CPI, which excludes volatile food and energy prices, came in at 3.8%, slightly above the anticipated 3.7%. These numbers suggest a continued upward trend in inflation, which could impact consumers' purchasing power and the overall economy.
Therefore, the impact of the US inflation report on the gold price was muted, as the dollar remained weak. In the meantime, the expectations of Fed rate cuts in June offset concerns about rising inflation, keeping gold attractive as a safe-haven asset. Moving on, policymakers need to closely monitor these developments to assess the need for any adjustments to monetary policy in order to maintain price stability and economic growth.
Geopolitical Developments Boost Gold's Safe-Haven Appeal
On the geopolitical front, the ongoing discussions to resolve the Israel-Hamas conflict showing no progress, which is creating uncertainty in the market. Also, Houthi rebels in Yemen, backed by Iran, plan to increase military actions during Ramadan in support of Palestinians and in response to Gaza. Furthermore, the US has conducted defensive strikes against Houthi targets following anti-ship missile attacks. These events are escalating global tension, prompting investors to seek safety in assets like gold.
Therefore, geopolitical tensions, including stalled talks in Gaza and Houthi escalations in Yemen, along with US strikes, bolster the safe-haven appeal of gold, attracting investors amid uncertainty.
GOLD (XAU/USD) - Technical Analysis
In today's market, gold prices exhibited a marginal decline of 0.01%, settling at $2159.745. The subtle movement in price points towards a cautious stance among investors, reflecting on broader market sentiments and economic indicators. The pivot point for today is set at $2198, suggesting a tentative balance in trader expectations.
Technical indicators for gold present a nuanced picture. The Relative Strength Index (RSI) stands at 49, hovering near the midpoint of the scale, which indicates a balanced field between buying and selling pressures. Meanwhile, the 50-day Exponential Moving Average (EMA) at 2139 underscores a potentially bullish undercurrent, as current prices flirt closely with this level.
The immediate resistance and support levels further delineate the battleground for gold's short-term trajectory. Resistance is first encountered at $2197, with subsequent ceilings at $2227 and $2252. Conversely, the asset finds immediate support at $2131, with additional safety nets at $2111 and $2090.
Conclusion: The overall trend leans towards bullish above the $2155 mark, encouraging a strategic entry point for buyers. A targeted take profit at $2197 and a stop loss set at $2132 are recommended to navigate the anticipated volatility.
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