Current Dynamics
The XAU/USD pair shows moderate growth during the Asian session, testing the 2520.00 level. This movement comes as investors await U.S. inflation data, which could influence the Federal Reserve's (Fed) future decisions on interest rates.
Inflation Expectations
Analysts project a slowdown in the annual consumer price index to 2.5% in August, down from the previous 2.9%. Monthly inflation is expected to rise by 0.2%, with the core index remaining stable. Any signs of increased inflationary pressure might lead the Fed to adopt a more cautious stance, potentially delaying rate cuts.
Impact of the ECB
On Thursday, the European Central Bank (ECB) is expected to lower the interest rate by 25 basis points to 4.00%, a move that could boost gold prices. Inflation in Germany, which has fallen to 1.9%, the lowest since March 2021, supports the ECB's decision to ease monetary policy.
Support and Resistance Levels
On the daily chart, Bollinger Bands indicate consolidation with the price range narrowing, suggesting a pause in the upward trend. The MACD shows a weak buy signal, while the Stochastic indicates potential overbuying of gold in the short term.
Resistance: 2525.00, 2540.00, 2555.00, 2570.00
Support: 2510.00, 2500.00, 2483.64, 2470.00
Trading Strategies
Long Positions: A break above 2525.00 could signal opening long positions, targeting 2555.00. Place the Stop Loss at 2510.00, with a timeframe of 1-2 days.
Short Positions: A rejection at 2525.00 followed by a drop below 2510.00 suggests opening short positions, aiming for 2483.64. Set the Stop Loss at 2525.00.
The gold market is at a critical juncture, with upcoming economic data likely to dictate price direction. Investors should closely monitor indicators and announcements to adjust their strategies accordingly.