Gold Price Prediction – Gold Prices Stabilized as the Dollar Rally Paused 

Key Insights

• • Gold prices hold steady as the dollar edged lower. 
  • The NFIB Small Business Economic Trends was below the 48-year average of 98.
  • Treasury yields pulled back amid concerns over  inflation and slower growth.

Gold prices remain little changed as investors bought gold ahead of tomorrow’s inflation report that might impact the Fed’s monetary policy. The dollar fell against other major currencies.

Benchmark yields pulled back today in the wake of the Fed’s less aggressive policy. The ten-year yield dipped below 3% today after extending gains by 23 basis points yesterday. 

The NFIB Small Business Economic Trends came in at 93.2, which was the same as the previous month. This reading, which indicates US small business confidence, was below the 48-year average of 98.

This data signals that small businesses are struggling to deal with mounting inflation pressures. Small businesses are dealing with rising labor costs and a labor shortage, increasing their economic struggles.

Tomorrow’s Inflation report will likely impact the Fed policy decision at the next meeting.

Technical Analysis

Gold prices head toward the 200-day moving average of 1836 and face downward pressure that can send gold prices down towed 1800. Support is seen near the 200-day moving average at 1,836. Resistance is seen near the 10-day moving average near 1,874. 

Short-term momentum is negative as the Fast Stochastic generated a crossover sell signal. Prices are oversold as the fast stochastic prints a reading of 9.79 below the oversold trigger level of 20.

Medium-term momentum has turned negative as the MACD generates a crossover sell signal. This occurs as the 12-day moving average minus the 26-day moving average crosses below the 9-day moving average of the MACD line.

The  MACD (moving average convergence divergence) histogram has a negative trajectory that points to lower prices.