Fundamental
Overview
Gold got a boost
from the benign US CPI report on Wednesday where the data came in line with expectations. The
market firmed up the rate cuts expectations with September and December now
fully priced in. The Treasury yields and the US Dollar weakened as a result supporting
gold prices. In the bigger picture, nothing has changed, so the path of least
resistance should remain to the upside for now.
Gold Technical
Analysis – Daily Timeframe
Gold Daily
On the daily
chart, we can see that gold is slowly climbing back to the all-time high as the
US data calmed the fears around inflation and rate hikes. From a risk
management perspective, the buyers will certainly have a much better risk to
reward setup around the 2150 level where we can find the confluence
of the trendline
and the 61.8% Fibonacci
retracement level, but we haven’t got any catalysts to trigger such a big
correction.
Gold
Technical Analysis – 1 hour Timeframe
Gold 1 hour
On the 1 hour
chart, we can see that the price pulled back after the rally following the US
CPI release and bounced on the trendline around the 2375 level. This is where
the buyers are piling in with a defined risk below the trendline to position
for an extension into the all-time high at 2430.
If the price were
to break lower, that would be a signal that the bullish momentum has waned, and
the sellers will likely pile in to target a drop into the next support around
the 2355 level where we can find the confluence of another trendline and the
61.8% Fibonacci retracement level. That’s where the buyers will have another
chance to position for a rally into the all-time high with an even better risk
to reward setup.
Upcoming
Catalysts
We don’t have anything
on the calendar for today, so the market will likely consolidate into the
weekend.