Gold Technical Analysis | Forexlive

The miss in the US CPI report led
to a big upside move in Gold as expectations of less hikes and earlier rate
cuts supported the precious metal. Unfortunately, there are also headwinds for
Gold coming from strong data like the US labour market and the consumer sentiment. In fact,
the Fed is not yet confident in letting it go on the tightening side as we
heard from Fed’s Waller that a hike in July is a done deal, and we may even get
another one already in September.

Gold Technical Analysis –
Daily Timeframe

On the daily chart, we can see that the 61.8% Fibonacci retracement level
stalled the fall in Gold where the price bounced, eventually breaking above the
downward trendline. The
miss in the US CPI report has also led to a break above the 1934 resistance and the moving averages are now
crossed to the upside. The bias is bullish, and the buyers should be eyeing the
1984 resistance next.

Gold Technical Analysis – 4
hour Timeframe

On the 4
hour chart, we can see that if we get a pullback, the buyers should lean on the
black trendline where we can also find the 38.2% Fibonacci retracement level
with a defined risk below the trendline and target the 1984 resistance. The
sellers, on the other hand, will want to see the price breaking below the 1934
support to pile in and target a new low.

Gold Technical Analysis – 1
hour Timeframe

On the 1 hour chart, we can see that we
have a minor support around the 1950 level defined by the 38.2% Fibonacci
retracement level of the rally since the US CPI miss. Aggressive buyers may be
already piling in here to target the 1984 resistance. More conservative buyers
may wait for the price to take out the counter trendline and the moving
averages to crossover before piling in and target the resistance.

Upcoming Events

This week the
main events are the US Retail Sales tomorrow and the US Jobless Claims on
Thursday. Strong readings may be a headwind for Gold as the Fed should keep
hiking despite the miss in the US CPI last week as Fed’s Waller also noted that
one report doesn’t make a trend. Conversely, if the data misses expectations,
the market’s expectations for less hikes and even earlier rate cuts should
support Gold.