Gold Price Forecast: $4,500 Resistance in Focus Ahead of CPI

Gold Technical Analysis

The gold market finds itself somewhat noisy in early trading on Thursday as we wait for the ECB interest rate decision, expected to be an increase of 25 basis points. Really, at this juncture, it is going to be more about the next several days for gold, as we get PPI during the session today, but we also get CPI tomorrow, which might be the more important read for inflation in the USA.

We Are Sitting Just Above the 50-day EMA, but Just Below the $4,500 Level

We are essentially stuck at the moment. But with that being said, the amount of information that we get over the next week could finally send this market in one direction or the other. Until then, it could be messy, to say the least.

Once we get that CPI reading out of the way, it then shifts focus to the Federal Reserve on Wednesday and the Bank of Japan on Thursday. Overall, I do think that a hotter-than-anticipated CPI might be bad for gold on Friday. If the U.S. dollar starts to strengthen based on interest rate hike expectations, we are already starting to see a shift toward pricing in a stronger and more hawkish Federal Reserve, which does work against gold.

But at the same time, we do not have that actual data yet. So this is still very much a market that is in flux. Right now, it just seems like we are treading water, going sideways until we answer a few more questions in the next several sessions.

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