Trading GOLD on US Inflation Today

Posted Tuesday, March 13, 2018 by
Arslan Butt • 1 min read

It’s been two days that Gold is consolidating in a narrow trading range of $1,315 – $1,324. Taking advantage of the situation, our forex trading signal managed to encash quick profit in Gold. We have the US inflation figures up next and there’s a very neat trade setup on Gold. Let’s make more profits.

Fundamentals Overview

CPI m/m – The data is due to be released at 13:30 (GMT). As you know, the wages have dropped along with mixed labour market reports. The big question is, what can we expect now? Core CPI is anticipated to remain stable at 1.8% y/y and increase by 0.2% m/m after a previous figure of 0.3%. The CPI m/m is also expected to increase to 0.2% vs. 0.5% in January.

GOLD – XAU/USD – Technical View

The technical side of Gold hasn’t changed this week as the market continues to trade in the sideways range. You can see in the 4-Hour chart below that Gold is facing a solid resistance at $1,324 along with a support at $1,315.

Gold - 4 Hour Chart - Sideways Range

Gold – 4 Hour Chart – Sideways Range

  • Positive CPI – The trading range is likely to be violated on the release of the US CPI data. In the case of positive figures, Gold is likely to break down and extend it’s bearish trend up to $1,302.
  • Negative CPI – The negative inflation figures can bring bullish breakout and Gold can extend it’s bullish rally up to $1,335.

Gold – XAU/USD – Trading Plan

Considering this, we have two options:

Choppy Trading –  Sell below the upper range ($1,324) and buy at the lower range ($1,315) for 30 PIPs, before the CPI release.

Breakout – Or wait for a news release and a breakout.

Good luck.

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