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Gold (XAU) Daily Forecast: Triangle Keeps Price Under $2,325; What’s Next?

By:
Arslan Ali
Published: Jun 18, 2024, 06:50 GMT+00:00

Key Points:

  • Gold price dip-buying on Tuesday reverses modest losses from the previous day.
  • Fed's hawkish stance supports USD, capping significant gains for Gold.
  • US Dollar dip-buying creates headwinds, but expectations for 2024 rate cuts persist.
Gold (XAU) Daily Forecast: Triangle Keeps Price Under $2,325; What’s Next?

In this article:

Market Overview

Gold price (XAU/USD) experienced some dip-buying during the Asian session on Tuesday, partially reversing the previous day’s modest losses. Recent US macroeconomic data suggests subsiding inflationary pressures, maintaining hopes for a Federal Reserve rate cut in September.

Fed’s Hawkish Stance and US Dollar Impact

Last week, the Fed maintained a hawkish stance, indicating only one interest rate cut this year. This outlook supports elevated US Treasury bond yields, strengthening the US Dollar (USD) and limiting significant gains for Gold.

Additionally, a generally positive risk tone may cap the safe-haven demand for Gold. Robust follow-through buying is needed to confirm that the recent decline from the all-time peak has ended.

US Dollar Dip-Buying and Inflation Data

The US Dollar saw some dip-buying on Tuesday, creating headwinds for Gold. Despite this, expectations for two rate cuts by the Fed in 2024 temper any significant slide.

The Fed’s projection of a single rate cut this year, compared to three in March, helped US bond yields recover and the USD regain traction. Philadelphia Fed President Patrick Harker’s comments on maintaining current rates to control inflation further pressured Gold.

Economic Indicators and Fed Speeches

Data released on Friday showed US import prices fell for the first time in five months in May. Combined with weaker US consumer and producer prices, this indicates subsiding inflation, keeping hopes for Fed rate cuts alive.

Investors are now focused on Tuesday’s US economic releases, including Retail Sales and Industrial Production data, for short-term trading opportunities. Additionally, speeches by several influential FOMC members are expected to impact USD demand and, consequently, Gold prices.

Short-Term Forecast

Gold (XAU/USD) faces resistance at $2,325.62. A breakout above this level may trigger bullish momentum. Immediate support is $2,310.85; a drop below could indicate further declines.

Gold Prices Forecast: Technical Analysis

Gold – Chart

About the Author

Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.

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