Gold Price Hovers Near $2,265: Geopolitics & Fed in Focus
Gold (XAU/USD) price has entered a consolidation phase in Tuesday’s Asian trading session, stabilizing after a rally to unprecedented
Gold (XAU/USD) price has entered a consolidation phase in Tuesday’s Asian trading session, stabilizing after a rally to unprecedented levels, with highs nearing the $2,265 area observed yesterday. Despite robust U.S. manufacturing data challenging the likelihood of the Federal Reserve cutting interest rates thrice in the current year, the market’s expectations of a rate reduction commencing in June remain intact.
This anticipation, coupled with ongoing geopolitical unease, particularly in the Middle East, is expected to bolster the safe-haven asset, suggesting a cautious approach before confirming a peak in the near-term XAU/USD value and anticipating any significant pullback.
Investors now await the U.S. economic indicators and statements from influential Fed officials for further direction.
Gold investors weigh the potential impact of solid U.S. manufacturing data on the Fed’s rate cut projections. Higher U.S. Treasury bond yields drive the dollar, presenting headwinds for gold.
Geopolitical Tensions Underpin Safe-Haven Demand:
Middle Eastern conflicts could curb risk appetite, offering support to gold prices.
Following Israel’s airstrike on an Iranian facility in Syria, market sentiment is cautious, with concerns about escalating regional tensions potentially enhancing gold’s appeal.
The Fed’s inflation measure, the PCE Price Index, reported a moderate inflation increase in February, maintaining expectations for Fed rate adjustments, which could limit downside risks for gold.
Today’s spotlight is on the release of the JOLTS Job Openings and U.S. Factory Orders data, along with FOMC members’ speeches, all of which could influence dollar valuations and gold price forecasts.
Gold Price Forecast: Technical Outlook
In the latest trading session, GOLD spot prices manifested a state of flux, oscillating within a defined bracket. The metal’s price action is confined between a resistance at approximately $2,265 and a support near $2,232.
Gold’s pivot point hovers at the $2,251 mark, serving as a barometer for short-term directional bias. The immediate resistance levels are placed slightly higher, indicating potential price ceilings should the asset attempt an upward move.
Technical indicators, such as the Relative Strength Index (RSI), are holding steady with a reading around 70, denoting bullish momentum but also flagging potential overbought conditions.
Additionally, the 50-day Exponential Moving Average (EMA) is plotted at $2,199, trailing below the current price, thereby reinforcing a positive trend.
In conclusion, the current technical setup for Gold is tilted towards bullishness, with the RSI and 50 EMA underpinning this sentiment. The metal’s price movement above the pivot suggests an uptrend continuity, but traders should be wary of a potential reversal if resistance levels persistently cap gains.
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