Gold Prices Stall Amid Anticipation of Fed’s Rate-Hike Trajectory
As GOLD (XAU/USD) struggles to build on its recent recovery from the two-week low in the $1,957-1,956 zone, its price fluctuates within a tight range in Wednesday’s Asian trading session. Market participants are exercising caution, awaiting further clarity on the Federal Reserve’s interest rate trajectory before committing to new positions.
The resilience of the U.S. economy, as acknowledged by various Federal Reserve officials, suggests that the central bank’s interest rate increases may not have concluded. Consequently, the forthcoming speech by Fed Chair Jerome Powell during the North American session is expected to be a pivotal factor influencing the inert gold market.
Meanwhile, the ongoing decline in U.S. Treasury yields caps the U.S. Dollar’s recovery from its lowest point since September 20, reached earlier this week. This dynamic, coupled with the prevailing cautious sentiment in the market and the uncertainties surrounding China, provides some support for GOLD prices, offering a buffer against significant declines.
Professional Analysis: Awaiting Direction – Gold’s Momentum Hinges on Powell’s Forthcoming Remarks
Investor sentiment remains tempered by the ambiguity surrounding the Federal Reserve’s forthcoming policy decisions, resulting in subdued GOLD price movements. Recent comments by Fed officials have reignited questions about whether the current interest rate level will suffice to curb inflation or if further increases are necessary.
Notably, Minneapolis Fed President Neel Kashkari recently emphasized the robustness of the labor market, suggesting that the Federal Reserve’s efforts to cool the economy are not yet complete. Similarly, Fed Governor Michelle Bowman and Chicago Fed President Austan Goolsbee indicated that future rate adjustments would largely depend on the trajectory of inflation, without committing to a specific course of action.
Attention is now converging on Fed Chair Jerome Powell’s imminent speech, which is expected to offer valuable insights into the Fed’s next steps, potentially providing a new directional stimulus for XAU/USD.
Technical Analysis: Gold’s Bearish Outlook as Double Top Pattern Emerges
GOLD prices have approached the anticipated target of $1,962.35, stabilizing near this level. However, the formation of a double top pattern suggests mounting bearish pressure, which could drive prices below the current threshold, paving the way for a deeper bearish correction. The next bearish milestone is projected to be at $1,933.30.
Negative signals from technical indicators bolster the forecast for continued decline, contingent upon the price maintaining below $1,975.25.
Today’s anticipated price range is between $1,950.00 support and $1,980.00 resistance, with the trend expected to lean bearish.
Gold XAU Live Chart
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