On Wednesday, the precious metal gold rose sharply to its highest level since early September, accompanied by a weaker dollar, as investors awaited US inflation data due later today. Spot gold was up 0.3 percent to $1,828.74 per ounce after reaching a high of $1,831.10 on September 3. Gold futures in the United States finished 0.2 percent higher at $1,830.80. On Wednesday, the eyes will remain on the US inflation figures. 

Gold Rate Live

The US dollar, which gold has been tracking throughout the day, fell versus its counterparts, making gold less costly for holders of other currencies. Last week, key central banks signaled that interest rates would remain low in the near term, enhancing the attraction of non-yielding gold and driving the metal towards scoring its best weekly performance since late August. However, a tight labor market in the United States and disruptions in global supply chains may result in a high reading for US consumer prices due on Wednesday.

Wholesale prices rise 8.6% a year

The Labor Department reported Tuesday that wholesale prices jumped 8.6 percent from a year ago in October, the greatest annual rate in nearly 11 years of records. 

The government’s producer price index (PPI), which acts as a barometer of final demand prices from goods producers, rose 0.6 percent for the month, in line with Dow Jones forecasts and indicating that inflationary pressures continue to weigh on the US economy. The monthly rate was faster than September’s 0.5 percent growth.

US inflation in highlights 

Analysts anticipate US inflation to accelerate further, with core inflation hitting more than 5% before the end of the year and headline inflation exceeding 6%. The widening of the inflation profile will continue into 2022, as wage growth tends to exacerbate price pressure at the median level, which is why the Fed will see more evidence of a larger price increase. This supports our forecast of a faster-than-expected taper and three rate hikes in 2022.

Gold rejected below $1,833 ahead of US inflation figures

Gold is trading at the 1,827 level, facing strong resistance at the 1,833 level. On the 4-hour timeframe, XAU/USD is trading with a bullish bias, maintaining an upward channel. A break above the 1,833 level could lead GOLD towards the next resistance level of 1,842.

Daily Technical Levels

Support Resistance

1822.92 1836.48

1814.23 1841.35

1809.36 1850.04

Pivot Point: 1827.07

Conversely, the support level stays at the 1,821 level, and the violation of this level exposes the metal towards the 1,814 level. The RSI and stochastic are in an overbought zone, and the closing of candles below the 1,833 level exposes the metal price towards the 1,814 level. Let’s consider taking a sell trade below 1,833 and buying above the same. Good luck!