Gold is trading slightly lower on Monday morning after gold prices rose to a two-month high on Friday following the weak U.S inflation report.
According to the CPI report – U.S. consumer prices rose by 0.1% in July from the prior month, bringing the annual consumer price index to 1.2%.
The next Fed’s meeting will be closely watched as traders look for more inputs on the timing of the next U.S. rate hike.
Technical Outlook
Gold prices have almost reached the resistance area at $1300. The single candle in the top of the uptrend has formed a “Spinning top candle stick pattern”. This current uptrend may reverse down.
Gold prices are about to make their third attempt to hit $1300. Traders should be careful around this area as technical parameters indicate Triple Top chart which might be a reversal point.
On the other hand, a break above 1300 will cancel the Triple Top pattern. Furthermore, upside rally may continue towards $1318-$1362.
The Long term 100-day moving average crossed above the Short term 50-day moving average as seen in the chart. This indicates a bullish momentum.