Fundamental Overview
Gold found some support from renewed tariffs fears and managed to pull back into the 2900 level. Real yields continue to fall as nominal yields recently fell much faster than inflation expectations. The culprit is likely Trump’s tariffs policy as it keeps inflation expectations high while also depressing growth expectations.
The next NFP and CPI reports will be key for the market. Hot data, especially on the inflation side, will likely weigh on gold prices as the market might pare back its expectations for rate cuts that recently saw an increase to 75 bps of easing by year-end compared to 44 bps just last week.
Gold Technical Analysis – Daily Timeframe
On the daily chart, we can see that gold bounced around the 2832 level last Friday and extended the pullback into the 2900 level on renewed tariffs fears. There’s not much we can glean from this timeframe, so we need to zoom in to see some more details.
Gold Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price broke above the downward trendline that was defining the pullback into the 2790 level. The buyers piled in on the break to position for the rally back into the all-time highs. The sellers, on the other hand, will likely step in around the all-time highs to target again the 2790 level.
Gold Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we had a bit of a consolidation around the 2893 level but the price is now breaking above the minor resistance with the buyers increasing their bullish bets into the all-time highs. The sellers will want to see the price breaking below the upward trendline to regain conviction and position for a drop into the 2790 level next. The red lines define the average daily range for today
Upcoming Catalysts
Today the market participants will be on the lookout for tariffs headlines as they go into effect for Canada, Mexico and China. Tomorrow, we have the US ADP and the US ISM Services PMI. On Thursday, we get the latest US Jobless Claims figures. On Friday, we conclude the week with the US NFP report.
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This article was written by Giuseppe Dellamotta at www.forexlive.com. Read More Details
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