Gold Price Forecast: XAUUSD unlikely to move much further from the lows

Gold climbed toward $1,650 despite the hawkish Fed tone. However, the recovery is set to stall, strategists at Commerzbank report.

Gold under pressure following the hawkish remarks made by the Fed chair

“Fed Chair Jay Powell stressed that the speed of rate hikes was not so important anymore and that the key question was the level at which interest rates would finally peak. And this, Fed members now believe, looks set to be higher than they had assumed in September.”

“The Fed’s goal is to bring real interest rates into positive territory. This means that the key rate will remain at a high level until such time as the rate of inflation has fallen below it.”

“Generally speaking, the FOMC meeting turned out to be more hawkish than expected, which was then reflected in higher interest rate expectations and a firmer dollar and ultimately caused the Gold price to fall. Shortly before hitting its yearly low, Gold did a U-turn and began climbing again, though today’s US labour market report could put the brakes on its recovery again.”

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Gold Price Forecast: XAU/USD consolidates above $1,660 level amid modest USD strength

• A combination of factors prompts some selling around gold on Thursday.
• Rising US bond yields revive the USD demand and exert some pressure.
• Bets for a less hawkish Fed offer support ahead of the US Q3 GDP report.

Gold struggles to gain any meaningful traction on Thursday and seesaws between tepid gains/minor losses through the first half of the European session. The XAU/USD remains below a nearly two-week high set the previous day and is currently trading around the $1,663-$1,662 area, nearly unchanged for the day.

The US dollar regains some positive traction and stages a goodish rebound from its lowest level since September 20, which, in turn, acts as a headwind for the dollar-denominated gold. Apart from this, a positive tone around the US equity futures further contributes to capping the upside for the safe-haven precious metal.

That said, expectations that the Fed may slow the pace of its policy tightening helps limit the downside for the non-yielding gold. The incoming US macro data pointed to signs of a slowdown in the world's largest economy and forced investors to trim their bets for more aggressive rate hikes by the US central bank.

Traders also prefer to move to the sidelines ahead of Thursday's key event/data risks. The European Central Bank is scheduled to announce its policy decision and is widely expected to hike interest rates by 75 bps. Apart from this, the Advance US Q3 GDP report should infuse some volatility and provide a fresh impetus to gold.

From a technical perspective, the recent recovery from the vicinity of the YTD low stalls near the $1,675 intermediate hurdle. This is followed by the $1,682 supply zone, which if cleared decisively will set the stage for an extension of the recent positive move witnessed over the past week or so, from the vicinity of the YTD low.

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Gold Price Forecast: XAU/USD drops to key support amid stronger USD, Fed rate hike jitters

• Gold remains under heavy selling pressure for the fourth successive day on Monday.
• Aggressive Fed rate hike bets continue to boost the USD and weigh on the XAU/USD.
• The risk-off mood could lend some support ahead of this week’s key event/data risks.

Gold extends last week's retracement slide from the $1,730 region and continues losing ground for the fourth successive day on Monday. The downward trajectory remains uninterrupted through the first half of the European session and drags spot prices to key support at a one-week low, around the $1,678 region in the last hour.

Expectations that the Fed will stick to its aggressive policy tightening path lifts the US dollar to a one-and-half-week high, which, in turn, is seen weighing on the dollar-denominated gold. The robust US monthly jobs report released on Friday pointed to the resilient economy and gives the US central bank enough space to keep hiking rates at a faster pace to combat stubbornly high inflation.

In fact, the markets are now pricing in a greater chance of the fourth consecutive supersized 75 bps rate increase at the next FOMC policy meeting in November. This remains supportive of elevated US Treasury bond yields and further contributes to driving flows away from the non-yielding yellow metal. Hence, the market focus remains on the FOMC minutes and the US consumer inflation data.

Investors will look for fresh clues about the Fed's future rate hike path, which, in turn, will play a key role in influencing the USD and provide a fresh directional impetus to gold. Apart from this, traders, this week will take cues from the US monthly Retail Sales data. In the meantime, the prevalent risk-off mood could limit losses for the safe-haven XAU/USD amid holiday-thinned liquidity. In addition, gold has reached an important support level in the $1,670s, where it met with significant resistance prior to its breakout last week. This level is now likely to offer support to prices and provide a rallying point for bulls, although the extent of the support is difficult to determine, and traders should keep in mind that the short and medium-term bias remains to downside.

The market sentiment remains fragile amid worries about economic headwinds stemming from rapidly rising borrowing costs. Apart from this, a further escalation in the Russia-Ukraine conflict and renewed US-China trade jitters temper investors' appetite for riskier assets. That said, the lack of any buying interest around gold suggests that the path of least resistance is to the downside, although a daily open or close below the current support ledge in the $1,670s would be required to confirm further downside to come.  

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Gold Price Forecast: XAU/USD sits near three-week high, above $1,700 amid weaker USD

Gold gains strong follow-through traction and rallies to a three-week high on Tuesday.

Retreating US bond yields weighs heavily on the USD and offers support to the metal.

Bulls shrug off the risk-on impulse, though hawkish Fed expectations could cap gains.

Gold is extending the overnight breakout momentum through the $1,680-$1,685 supply zone and building on its recovery from the lowest level since April 2020. The strong follow-through positive move lifts the XAU/USD to a three-week high, around the $1,710 region during the first half of the European session on Tuesday.

The US dollar retreats further from a two-decade top touched last week and turns out to be a key factor driving flows towards the dollar-denominated commodity. The Bank of England's willingness to buy up to £5 billion of long-dated gilts drags the US bond yields away from a multi-year top and continues to weigh on the greenback.

Apart from this, growing worries about a deeper economic downturn in the US and Europe offer additional support to the safe-haven gold. The fears were further fueled by Monday's disappointing US data, which showed that manufacturing activity grew marginally in September, at its slowest pace in nearly 2-1/2 years.

This, to a larger extent, helps offset the risk-on mood and does little to dent the prevalent bullish sentiment surrounding gold. That said, the prospects for a more aggressive policy tightening by major central banks could act as a headwind for the non-yielding yellow metal and keep a lid on any further gain, at least for now.

Market participants now look forward to the US monthly employment details, scheduled for release on Friday. The popularly known NFP report will play a key role in influencing the Fed's future rate hike path. This, in turn, should help investors to determine the next leg of a directional move for the greenback and gold.

In the meantime, Tuesday's US economic docket features JOLTS Job Openings and Factory Orders data. This, along with speeches by FOMC members and the US bond yields, will drive the USD demand and provide impetus to the XAU/USD. Traders will also take cues from the broader risk sentiment for short-term opportunities around gold.

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Gold Price Forecast: XAU/USD likely to extend range play around $1,660 

Gold price is turning south once again after facing rejection at higher levels.

The metal is defending gains amid a broadly weaker US dollar, risk-aversion.

XAU/USD battle lines are well-defined around $1,660 ahead of key US events.

Gold price is moving back and forth in a familiar range above $1,650, as the investors refrain from placing any directional bets amid rife geopolitical tensions concerning Russia and Ukraine, aggressive Fed rate hike bets and surging oil prices. Meanwhile, the US dollar is trading choppy but slightly on the downside, limiting the downside in the bullion. The UK tax policy U-turn put a sudden bid under GBP/USD, inducing fresh weakness in the dollar while helping the metal defend mild gains. Attention turns towards the US ISM Manufacturing PMI after the euro area and the UK S&P Global final Manufacturing PMIs failed to impress the market. The main event risk this week, however, remains the US Nonfarm Payrolls data due for release this Friday.

Gold Price: Key levels to watch

The Technical Confluence Detector shows that the gold price is looking to challenge the $1,660 support area, where the previous day’s low, Fibonacci 38.2% one-month and Fibonacci 23.6% one-week coincide.

The SMA10 one-day at $1,657 will be seen as the next stop for sellers. Further down, the confluence of the SMA50 four-hour and Fibonacci 38.2% one-week around $1,654 could be tested.

The pivot point one-day S2 and SMA100 one-hour meeting point at $1,650 will be the line in the sand for buyers.

On the flip side, the Fibonacci 38.2% one-day at $1,665 offers immediate resistance to bulls, above which a run towards the $1,670 level cannot be ruled out. That level is the convergence of the Fibonacci 61.8% one-day and the pivot point one-day R1.

The previous day’s high of $1,675 will be next on the buyers’ radar, followed by the previous year’s low at $1,677.

About Technical Confluences Detector

The TCD (Technical Confluences Detector) is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc.  If you are a short-term trader, you will find entry points for counter-trend strategies and hunt a few points at a time. If you are a medium-to-long-term trader, this tool will allow you to know in advance the price levels where a medium-to-long-term trend may stop and rest, where to unwind positions, or where to increase your position size.

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Gold Price Forecast: XAU/USD south-run appears more compelling 

Gold price keeps reversal from the key hurdle, drops back towards yearly low.

Risk-aversion, hawkish central banks joined firmer yields to weigh on XAU/USD.

US Q2 GDP eyed for intraday clues, recession, Russia and central banks are in focus.

Bears can keep reins unless crossing $1,660 resistance confluence.

Gold price (XAU/USD) braces for the fresh yearly low, snapping a two-day uptrend, as the US dollar bulls return to the table after a brief absence the previous day. Fears of global recession and hawkish central bank actions are the major drivers that recently propelled the greenback. On the same line could be the upbeat US trade data and doubts over the Bank of England (BOE) and the People’s Bank of China (PBOC) to tame the economic slowdown woes. It’s worth noting that the chatters surrounding heavy rate hikes from the European Central Bank (ECB) joined the BOE’s surprise bond action to trigger the metal’s biggest daily jump in six months the previous day.

Given the sour sentiment and the XAU/USD pullback from the key hurdles, the bears are likely to keep the reins. However, a close watch over the aforementioned risk catalysts and the final readings of the US Q2 Gross Domestic Product (GDP) appears necessary for clear directions.

Gold Price: Key levels to watch

The Technical Confluence Detector shows that the gold price retreats from multiple strong resistances, suggesting a smooth run towards the south.

That said, a convergence of the previous weekly low and the SMA 100 on the hourly play, near $1,640, appears the immediate support to watch during the quote’s further weakness.

Following that, it can quickly decline towards the joint of the Pivot Point one week S1, close to $1,627.

During the XAU/USD downside past $1,627, the $1,600 appears the favorite among the gold bears.

Alternatively, $1,646 acts as the wall of resistance comprising Pivot Point one month S2, Fibonacci 38.2% on one day and 5-DMA.

If the metal prices cross the $1,646 hurdle, a run-up towards $1,653 can’t be ruled out. However, a convergence of 5-HMA, middle Bollinger on one-hour and Fibonacci 23.6% on one day and one week could challenge the buyers afterward.

It’s worth observing that the bullion’s run-up beyond $1,653 could aim for the last defense of bears, namely $1,660 that comprises the 10-DMA and Fibonacci 38.2% on one week.

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Gold Price Forecast: XAU/USD rises to more than one-week high amid heavy USD selling

Gold gains strong positive traction on Friday amid aggressive USD long-unwinding trade.

Aggressive Fed rate hike bets, elevated US bond yields should help limit the USD losses.

The risk-on impulse could further contribute to capping the safe-haven precious metal.

Gold attracts fresh buying on the last day of the week and climbs to a nearly two-week high during the early part of the European session. The XAU/USD is currently placed just below the $1,730 level and is looking to build on its recent bounce from the lowest level since July 21 touched last week.

The US dollar comes under heavy selling pressure on Friday and retreats further from a two-decade high, which turns out to be a key factor boosting demand for the dollar-denominated commodity. The steep USD downfall to a fresh monthly low could be solely attributed to some long-unwinding and is more likely to remain limited amid hawkish Fed expectations.

In fact, the US central bank is anticipated to tighten its monetary policy at a faster pace to tame inflation and the bets were reaffirmed by Fed Chair Jerome Powell on Thursday. Speaking at a Cato Institute conference, Powell reiterated the central bank's strong commitment to bringing inflation down and added that the Fed needs to keep going until it gets the job done.

Powell's remarks reaffirmed market bets for a supersized 75 bps rate hike at the next FOMC meeting on September 20-21. This remains supportive of elevated US Treasury bond yields, which should help limit any meaningful USD corrective slide. Moreover, other major central banks, except the Bank of Japan, have also maintained a more hawkish bias.

Apart from this, the risk-on impulse - as depicted by a generally positive tone around the equity markets - might further contribute to capping the upside for the safe-haven metal. This, in turn, warrants some caution for aggressive bulls. Nevertheless, gold remains on track to register weekly gains and snap a three-week losing streak.

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BOE’s Pill: All inflation forecasts are dependent on very volatile gas prices

 

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Bank of England (BOE) Chief Economist Huw Pill is testifying on the bank’s Monetary Policy Report (MPR) before Parliament's Treasury Committee on Wednesday.

Also read: Bailey speech: Confident BOE will respond to price shock

Key comments

Goldman Sachs UK inflation forecasts are mechanical implication of wholesale gas markets.

Goldman Sachs forecasts illustrate how much market prices have changed since BOE prepared Aug inflation forecast.

Some of rise in gas prices has reversed since Goldman inflation forecast.

All inflation forecasts are dependent on very volatile gas prices.

Inflation forecast also depends on machinery by which wholesale gas prices translate into retail prices.

Politicians are considering transmission of wholesale gas prices to consumer.

Seems clear to me we will see changes in this area.

Inflation impact of future fiscal stimulus depends on details.

Supporting household incomes will boost demand, leading to slightly stronger inflation.

I would expect headline inflation to decline in short term.

Implication for inflation at monetary policy relevant horizon is unclear, given lack of detail.

Very short-term impact on government measures on inflation may not be most important thing for BOE.

Must emphasise importance of BOE inflation target as anchor, not consider new regime.

We are here to ensure fiscal policy does not generate inflation.

We think output measures of GDP are better measures of activity, as less distorted by problems with trade figures.

Hopefully quality of trade data will improve over time.

Gold Price Forecast: XAU/USD looks to $1,700 amid Fed rate hike bets – Confluence Detector

Gold continues losing ground for the second straight day and drops to over a one-month low.

Strong follow-through USD buying, rising US bond yields continue to weigh on the commodity.

The risk-off impulse might turn out to be the only factor that might help limit any further losses.

Gold remains under heavy selling pressure for the second successive day on Monday and drops to over a one-month low, around the $1,720 area during the early part of the European session. The US dollar hits a fresh two-decade high amid rising bets for more aggressive Fed rate hikes and continues to weigh on the dollar-denominated commodity.

In fact, the markets are pricing in a greater chance of a 75 bps rate increase at the September FOMC meeting. A further rise in the US Treasury bond yields reinforces market expectations, which is seen as another factor driving flows away from the non-yielding yellow metal. That said, the prevalent risk-off environment could offer some support to the safe-haven gold and help limit any further losses, at least for the time being.

Gold Price: Key levels to watch

The Technical Confluence Detector shows that the next relevant support for gold is pegged near the $1,719 area - Pivot Point One Day S2. This is closely followed by $1,714-$1,713 zone - Fibonacci 23.6% One Month. A convincing break below will expose the $1,706-$1,705 support - Pivot Point One Week S2 and the $1,700 round-figure mark. Some follow-through selling might make the XAU/USD vulnerable to retesting the YTD low, around the $1,680 region touched in July.

On the flip side, attempted recovery moves might now confront stiff resistance near the $1,728-$1,729 confluence support breakpoint, comprising Previous Week Low and Pivot Point One Day S1. The next relevant hurdle is pegged near the $1,732-$1,733 region - Fibonacci 38.2% One Month. Sustained strength beyond could trigger a short-covering rally towards the $1,737 zone - Fibonacci 23.6% One Week - en route to the $1,741-$1,742 region - Fibonacci 38.2% One Week - and the $1,745 barrier.

About Technical Confluences Detector

The TCD (Technical Confluences Detector) is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc.  If you are a short-term trader, you will find entry points for counter-trend strategies and hunt a few points at a time. If you are a medium-to-long-term trader, this tool will allow you to know in advance the price levels where a medium-to-long-term trend may stop and rest, where to unwind positions, or where to increase your position size.

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Gold Price Forecast: XAU/USD to see modest weakness for the remainder of 2022, before recovering in 2023

Gold prices have declined by 3.6% year-to-date. Strategists at ABN Amro have downgraded their gold price outlook, expecting modest weakness for the remainder of 2022, before prices will recover in 2023. 

New year-end forecasts are $1,700 in 2022 and $1,900 in 2023

“We expect modestly lower gold prices for the remainder of this year. There is a crucial support area layered at $1,680-$1,700. We expect these levels to be tested again and prices could move below these, albeit only temporary. Our new forecast for the end of 2022 is $1,700.”

“For 2023, the gold price outlook is more positive. Not only do we expect the US dollar to weaken, but we also expect the Fed to start cutting rates in the second half of 2023. On top of that, we expect lower US real yields. As a result, gold prices are likely to rebound next year. Having said that, we do not believe that gold prices will set a new high though.” 

“Our new year-end 2023 forecast is $1,900.”

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Gold Price Forecast: XAU/USD bears target $1,720 as US dollar keeps reins

Gold price extends its losing streak into the sixth straight day on Monday.

US dollar resumes its rally as risk-aversion gathers steam amid surging energy costs.

XAU/USD needs to crack $1,730 to extend the sell-off towards $1,720 and $1,714.  

Gold price remains under intense selling pressure at the start of the week, extending the previous week’s bearish momentum into the sixth straight day. The relentless demand for the safe-haven US dollar could be linked as the main underlying factor behind the latest sell-off in the bright metal. Investors witness flight to safety amid hawkish Fed expectations and surging energy costs in Europe and Asia after Russia’s Nord Stream 1 pipeline announced its closure due to maintenance end of this month. Global central banks’ fight to tame inflation is likely to prolong amid rising food and energy prices, which dents risk appetite while weighing negatively on the non-interest bearing yellow metal. Gold traders shrug off the minor pullback in the US Treasury yields, as the dollar will likely remain the preferred safety bet heading into the much-awaited Kansas City Fed’s Jackson Hole Symposium, scheduled later this week.

Gold Price: Key levels to watch

The Technical Confluence Detector shows that the gold price is eyeing a fresh downswing towards the Bollinger Band one-day Lower at $1,720 should bears yield a sustained break below the $1,730 barrier. That level is the intersection of the pivot point one-day S3 and pivot point one-week S1.

The next critical support area is located around $1,714, the Fibonacci 232.6% one-month.

Alternatively, the metal could rebound towards the pivot point one-day S2 at $1,737 should bears face exhaustion.

Further up, the pivot point one-day S1 at $1,743 will come into the picture. Bulls will then look to recapture the previous day’s low of $1,746.

The last line of defense for XAU sellers is envisioned at the confluence of the SMA200 four-hour and the Fibonacci 23.6% one-day around $1,750.

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Gold Price Forecast: XAU/USD to struggle on a peak in US inflation – ANZ

The challenges for the gold market are still in place. A peak in US inflation suggests a downside risk to the gold price. Still, increasing recessionary pressure and geopolitical risks could protect the downside, economists at ANZ Bank report.

Geopolitical and economic growth risks could protect the downside

“In 1980 when inflation peaked at 14.7%, gold prices started retreating from a high of $631/oz. Something similar happened in 2011, when inflation hit a high of 3.9% in September, triggering a fall from $1,900. With inflation peaking at 9% in June, we could see a similar fall in XAU/USD. The winding down of the Fed’s balance sheet also does not bode well.”

“Rising geopolitical tensions and economic risks could lend some support. The Russia-Ukraine war and China-US relations are issues that could trigger haven buying.”

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Gold Price Forecast: XAU/USD needs to crack $1,763 to extend the downside

Gold price nurses losses after impressive US NFP-inspired sell-off.

US dollar eases in tandem with the Treasury yields amid a better mood.

XAU/USD looks south towards $1,750, as 75 bps Sept Fed rate hike bets rise.

Gold price is licking its wound below the $1,800 mark, awaiting a fresh catalyst for the next leg lower. Risk-on flows have returned at the start of the week, fuelling a broad-based US dollar retreat while the Treasury yields also ease. Investors assess the implications of a super-sized Fed rate next months, the odds for which now stand at 70% after a big upside surprise in the US Nonfarm Payrolls for July. The jobs blowout raised the stakes for the July US inflation report due on Wednesday. The US Consumer Price Index (CPI) could likely see a slight pullback in headline growth but the core figure is seen accelerating. The debate of peak inflation remains in play heading into the key event risk of the week. The non-yielding bullion is expected to remain highly reactive to the US employment and inflation data after the Fed said that it remains data-dependent while deciding on its policy outlook.

Gold Price: Key levels to watch

The Technical Confluence Detector shows that the gold price needs to slice through a bunch of healthy support levels around the $1,772-$1,771 area to resume the post-NFP sell-off.

That demand zone is the convergence of the SMA5 one-day, Fibonacci 23.6% one-day and the previous low four-hour.

The Fibonacci 61.8% one-week at $1,769 will be next on sellers’ radars. However, bears need acceptance below the confluence of the Fibonacci 61.8% one-month and pivot point one-day S1 at $1,763 to negate the recent bullish momentum.

Further south, the intersection of the previous week’s low and the pivot point one-week S1 at $1,754 will guard the downside.

On the upside, the immediate resistance appears at $1,775, above which the Fibonacci 38.2% one-week at %1,780 will be challenged.

The next resistance levels are located at $1,784 and $1,786, which are the Fibonacci 61.8% one-day and Fibonacci 23.6% one-week respectively.

About Technical Confluences Detector

The TCD (Technical Confluences Detector) is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc.  If you are a short-term trader, you will find entry points for counter-trend strategies and hunt a few points at a time. If you are a medium-to-long-term trader, this tool will allow you to know in advance the price levels where a medium-to-long-term trend may stop and rest, where to unwind positions, or where to increase your position size.

WANT TO DIRECT TALK OUR EXPERT CONTACT MONEY LIFE RESEARCH

Gold Price Forecast: XAU/USD climbs to $1,775 area, fresh daily high amid softer USD

Gold gains traction for the second successive day on Thursday amid modest USD weakness.

Retreating US bond yields seem to weigh on the USD and lend support to the commodity.

The prospects for a further policy tightening by the Fed could cap ahead of the NFP on Friday.

Gold builds on the previous day's modest move up and gains some follow-through traction for the second successive day on Thursday. The steady intraday ascent extends through the early European session and lifts the XAU/USD to a fresh daily high, around the $1,774-$1,775 region.

Growing worries about a global economic slowdown, along with heightened US-China tensions caused by US House Speaker Nancy Pelosi's Taiwan trip, continue to act as a tailwind for gold. Apart from this, the emergence of some selling around the US dollar offers additional support to the dollar-denominated commodity. Despite more hawkish comments by FOMC members, the USD has been struggling to capitalize on this week's goodish bounce from its lowest level since July 5 amid retreating US Treasury bond yields.

That said, the prospects for a further policy tightening by the Fed could hold back bulls from placing aggressive bets around the non-yielding gold. In fact, several Federal Reserve officials hinted this week more interest rates are coming in the near term. This, along with the recent recovery in the global equity markets, could further contribute to capping gains for the safe-haven XAU/USD. Investors might also prefer to move on the sidelines ahead of the release of closely-watched US monthly employment details.

The popularly known NFP report is scheduled for release on Friday and will play an important role in influencing the USD price dynamics. This, in turn, would act as a fresh catalyst, which should allow traders to determine the near-term trajectory for gold. In the meantime, traders on Thursday would take cues from the Bank of England monetary policy decision. Later during the early North American session, the usual US Weekly Jobless Claims data could produce some trading opportunities around the XAU/USD.

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Gold price climbs to two-week high amid the post-FOMC USD selling, focus shifts to US GDP

Gold price scales higher for the second successive day and climbed to over a two-week high.

The post-FOMC USD selling bias remains unabated and is offering support to the metal.

Rebounding US bond yields, the risk-on impulse could cap gains ahead of the US Q2 GDP.

Gold price builds on the overnight goodish rebound from the $1,711 area, or a multi-day low, and gains some follow-through traction for the second successive day on Thursday. The positive move lifts the XAUUSD to over a two-week high during the early European session, with bulls now awaiting sustained strength beyond the $1,745-$1,750 strong resistance zone.

The US dollar prolongs the previous day's less hawkish FOMC-inspired decline and slips to its lowest level since July 6. This, in turn, is offering some support to the dollar-denominated gold. During the post-meeting press conference, Fed Chair Jerome Powell signalled that another large adjustment could be coming at the next policy meeting in September, but it would be dependent on the incoming data.

Furthermore, the Fed officials also acknowledged that economic indicators have softened and noted signs of a slowdown. This suggests that the US central bank would slow the pace of its interest rate hikes, which continued weighing on the greenback. That said, a goodish rebound in the US Treasury bond yields is acting as a tailwind for the buck and might keep a lid on the non-yielding gold, at least for the time being.

Apart from this, the risk-on impulse - as depicted by a generally positive tone around the equity markets - could further contribute to capping gains for gold. Even from a technical perspective, the $1,745-$1,750 region has been acting as a stiff resistance since the early part of July. This further makes it prudent to wait for strong follow-through buying before positioning for any further near-term appreciating move.

Market participants now look forward to the US economic docket, highlighting the release of the Advance Q2 GDP report later during the early North American session. The world's largest economy is expected to have grown by 0.4% annualized pace during the April-June period and avoid a technical recession. This would validate the Fed's view that the US economy isn't currently in a recession and provide a modest lift to the USD.

This, along with the US bond yields, would influence the USD price dynamics and drive the XAUUSD. Traders will further take cues from the broader market risk sentiment to grab short-term opportunities around gold.

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Gold Down Over an Expected Fed Hike

Gold was down on Monday morning in Asia while investors braced for a 75-basis-point interest rate hike by the U.S. Federal Reserve this week.

Gold futures edged down 0.16% to $1,724.55 by 12:25 AM ET (4:25 AM GMT). Gold prices have dropped more than $350, or 16% since scaling above the $2,000-per-ounce level in early March due to the Fed’s aggressive rate hikes and the dollar’s rally.

The dollar which normally moves inversely to gold, inched down on Monday morning, while the benchmark U.S. 10-year Treasury yields hovered near eight-week lows.

“The fall in U.S. yields on the back of global recessionary concerns has underpinned gold,” said SPI Asset Management managing partner Stephen Innes.

“Today, we could be seeing a touch of indecision ahead of the Federal Open Market Committee which is likely to underscore the Fed dilemma of fighting inflation at the expense of growth.”

Investors are now keeping an eye on the U.S. Federal Reserve’s two-day policy meeting which concludes on Wednesday, and markets are pricing in a 75-bp interest rate hike.

The European Central Bank (ECB) joined its global peers to bring down soaring inflation and raised interest rates by 50 bps. It is expected to deliver another hike until inflation falls back to its 2% target.

In other precious metals, silver fell 0.57%, platinum edged down 0.20%, and palladium fell 1.59%.

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 Gold Price Forecast: XAUUSD path of least resistance appears down

Gold price gathers strength to retest 11-month troughs below $1,700.

US dollar stalls correction as risk sentiment turns cautious ahead ECB, BOJ.

XAUUSD faces a wall of resistance despite falling Treasury yields.

Gold price continues to mire in yearly troughs so far this week, lacking a clear directional bias amid repricing of the Fed rate hike expectations. Investors also refrain from placing any aggressive bets on the bright metal ahead of the ECB and BOJ monetary policy announcements. The BOJ is widely expected to stick to its ultra-loose monetary policy while the ECB may surprise markets with a 50 bps rate hike. More hawkish than expected ECB could weigh negatively on the non-interest-bearing gold price. Meanwhile, the lack of first-tier US macro data combined with the Fed’s ‘blackout’ period leaves the metal traders in search of a significant catalyst. Meanwhile, the XAUUSD price will remain at the mercy of risk trends, with the US earnings season underway.

The Technical Confluence Detector shows that the downside appears more compelling for Gold price, as it faces a wall of resistance should any recovery momentum pick up steam.

A dense cluster of healthy resistance levels is stacked up around $1,711, where the SMA10 four-hour, Fibonacci 61.8% one-day and Bollinger Band four-hour Middle coincide.

The next hurdle is seen at the Fibonacci 38.2% one-day at $1,714, above which bulls will need vigor to take out the confluence of the Fibonacci 23.6% one-day and 38.2% one-week at $1,716.

The previous day’s high of $1,719 will be the level to beat for XAU bulls.

Alternatively, strong support awaits at $1,704, which is the convergence of the pivot point one-day S1 and pivot point one-month S3.

The next relevant downside target is aligned at the previous week’s low of $1,698.

Further south, the pivot point one-day S3 at $1,693 will come to the rescue of gold buyers.

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Gold Price Forecast: XAUUSD breaks below $1,800, bears gearing up to challenge YTD low

Gold Price was dragged below the $1,800 mark at the end of the week, its lowest level since May 16.

Aggressive Fed rate hike bets and a goodish pickup in the USD demand exerted some pressure.

Recession fears and the risk-off mood did little to lend any support to the safe-haven XAUUSD.

Gold Price prolonged this week's bearish trend and witnessed heavy follow-through selling on Friday, marking the fifth successive day of a negative move. The downward trajectory extended through the early part of the European session and dragged spot prices to the lowest level since May 16, around the $1,792 region in the last hour.

Flows were driven away from gold by the prospects for more aggressive rate hikes by the US central bank. These were reaffirmed by Fed Chair Jerome Powell's remarks on Wednesday, which said that the US economy is well-positioned to handle tighter policy. Speaking at the ECB Forum in Sintra, Powell added that the Fed remains focused on getting inflation under control and the market pricing is pretty close to the dot plot. Apart from this, broad-based US dollar strength further exerted downward pressure on the dollar-denominated commodity.

This combination of factors overshadowed the prevalent risk-off environment which tends to benefit the safe-haven precious metal. The market sentiment remains fragile amid concerns that rapidly rising rates and tightening financial conditions would pose challenges to global economic growth. Adding to this, the ongoing Russia-Ukraine war has been fueling fears about a possible recession. One would have thought this would embolden gold bulls but in reality it did little to impress investors or ease the bearish pressure surrounding gold.

The anti-risk flow was reinforced by the recent slump in the US Treasury bond yields, which, again, failed to lend any support to the yellow metal. With the latest leg down, spot prices now seem to have confirmed a fresh bearish breakdown below the $1,800 round-figure mark. Furthermore, effortless acceptance below the said handle might have already set the stage for an extension of the depreciating move towards the YTD low, around the $1,780 region. The downward trajectory could now extend towards the next relevant support near the $1,755-$1,750 zone. From here, traders now look forward to the release of the US ISM Manufacturing PMI for a fresh impetus.

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Gold Price Forecast: XAUUSD jumps to fresh daily high, bulls flirt with 200-DMA ahead of Powell

Gold attracted some dip-buying on Wednesday and rallied nearly $20 from a multi-day low.

The risk-off impulse, sliding US bond yields, modest USD pullback extended some support.

Hawkish Fed expectations kept a lid on any meaningful upside ahead of Powell’s testimony.

Gold reversed an intraday dip to the $1,823 region, or a four-day low touched earlier this Wednesday and shot to a fresh daily peak during the mid-European session. The XAUUSD was last seen trading around the $1,840 region, with bulls now awaiting a convincing break through the very important 200-day SMA.

The overnight optimistic move in the equity markets fizzled out rather quickly amid worries that a more aggressive policy tightening by major central banks would pose challenges to the global economy. Adding to this, the supply chain disruptions caused by the Russia-Ukraine war and the recent COVID-19 outbreak in China have been fueling fears about a potential recession. This continued weighing on investors' sentiment and triggered a fresh wave of the global risk-aversion trade, which, in turn, offered some support to the safe-haven gold.

The anti-risk flow was reinforced by a steep decline in the US Treasury bond yields and held back the US dollar bulls from placing aggressive bids. Apart from this, some repositioning trade ahead of Fed Chair Jerome Powell's testimony before the Senate Banking Committee forced the USD to surrender its intraday gains, which further benefitted the dollar-denominated gold. That said, expectations that the Fed would hike interest rates at a faster pace to curb inflation kept a lid on any meaningful upside for the non-yielding yellow metal.

Hence, investors will closely scrutinize Powell's comments for fresh clues about the policy tightening path. This will play a key role in influencing the near-term USD price dynamics and help determine the next leg of a directional move for gold. This makes it prudent to wait for a sustained move beyond a technically significant 200-DMA before traders start positioning for any further appreciating move for the XAUUSD.

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Gold Price Forecast: XAUUSD remains depressed below $1,850, bulls trying to defend 200-DMA

Gold met with a fresh supply on Friday and snapped a two-day winning streak.

Resurgent USD demand, the risk-on impulse turned out to be a key bearish factors.

The ongoing decline in the US bond yields offered some support and helped limit further losses.

Gold struggled to capitalize on its strong gains recorded over the past two trading sessions and witnessed some selling on the last day of the week. The XAUUSD remained depressed through the first half of the European session and was last seen trading just below the $1,850 level. Bulls, however, have managed to defend support at a technically significant 200-day SMA, warranting some caution before positioning for any further losses.

The US dollar caught aggressive bids and reversed a part of this week's retracement slide from a two-decade high amid hawkish Fed expectations. Investors seem convinced that the US central bank will stick to its aggressive policy tightening path to combat stubbornly high inflation. The bets were reaffirmed by the Fed's so-called dot plot, which showed that the median projection for the federal funds rate stood at 3.4% for 2022 and 3.8% in 2023. This, in turn, assisted the USD to snap a two-day losing streak to a one-week low and dented demand for the dollar-denominated gold.

Apart from this, the risk-on impulse - as depicted by a generally positive tone around the equity markets - further undermined the safe-haven precious metal. That said, the ongoing decline in the US Treasury bond yields offered some support to the non-yielding gold. Investors took comfort from the fact that the Fed forecasted the rate to decline to 3.4% in 2024 and 2.5% over the long run. This, in turn, dragged the US bond yields away from over a two-decade high touched earlier this week, which, along with mounting recession fears, could help limit deeper losses for gold, at least for now.

Market participants now look forward to the US economic docket, featuring Industrial Production and Capacity Utilization Rate for a fresh impetus later during the early North American session. Traders will further take cues from the US bond yields, the USD price dynamics and the broader market risk sentiment to grab short-term opportunities around gold on the last day of the week.

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