Fundamental Overview
The Fed yesterday kept its usual neutral stance and Fed Chair Powell didn’t offer anything in terms of forward guidance citing elevated uncertainty. The event didn’t move gold since there wasn’t anything new.
What impacted gold negatively was Trump saying that he would make a big announcement concerning a major trade deal today. Reports are saying that it will be a framework for a trade deal with the UK.
In the bigger picture, gold remains in an uptrend as real yields will likely continue to fall amid Fed easing. But in the short-term positive news on the tariffs front or a hawkish Fed could trigger more downside for gold as the market prices out stagflationary fears.
Gold Technical Analysis – Daily Timeframe
On the daily chart, we can see that gold rallied back above the 3400 level recently on some negative tariff related headlines. Trump’s announcement though triggered some downside on positive expectations. From a risk management perspective, the buyers will have a better risk to reward setup around the major trendline, while the sellers will look for a break lower to increase the bearish bets into the 2957 level next.
Gold Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see the price recently broke above the key swing level at 3367 before extending the rally above the 3400 level. The price fell back below the 3367 level and from a risk management perspective, the sellers will likely want to see a pullback into the level to position for further downside. The buyers, on the other hand, will want to see the price rising back above the 3367 level to pile in for a rally into a new all-time high.
Gold Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we have a minor downward trendline now defining the current pullback. If the price gets there, we can expect the sellers to lean on the trendline with a defined risk above it to position for a drop into the 3258 level next. The buyers, on the other hand, will look for a break higher to increase the bullish bets into new highs. The red lines define the average daily range for today.
Upcoming Catalysts
Today, we get the latest US Jobless Claims figures and Trump announcing the outline for a trade deal with the UK.
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This article was written by Giuseppe Dellamotta at www.forexlive.com. Read More Details
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