By RoboForex Analytical Department
Gold (XAU/USD) prices have rebounded to 2394 USD per troy ounce, paring previous losses as the likelihood of a US Federal Reserve rate cut increases. Market sentiment is increasingly cautious amid recession fears, influencing stock market dynamics and bolstering the appeal of non-yielding assets like gold.
Current market indicators, notably the CME FedWatch tool, suggest an almost certain probability of a rate reduction by the Federal Reserve in September. Such monetary easing typically enhances the allure of gold, which does not offer interest income.
Investor focus is now on upcoming US unemployment claims data, which will provide further insight into employment market conditions. Recent statistics from China revealed that the People’s Bank of China did not purchase gold bullion in July, marking the third consecutive month without an increase in gold reserves. This suggests a shift towards domestic economic stimulation as the Chinese economy faces challenges.
Ongoing tensions in the Middle East also underscore gold’s status as a safe-haven asset.
Technical analysis of XAU/USD
Free Reports:
Get our Weekly Commitment of Traders Reports - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.
Download Our Metatrader 4 Indicators – Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter
The H4 XAU/USD chart shows a declining trend towards the 2345.00 level, with a local target recently reached at 2364.23, followed by a correction to 2411.00. The market is anticipated to continue this downward trajectory towards 2355.80 before potentially rebounding to 2381.60. A further decline to 2345.00 is likely, aligning with the primary downtrend target. This bearish outlook is supported by the MACD indicator, which shows the signal line trending downwards from above zero.
On the H1 chart, gold is currently consolidating above 2381.60. A downward breakout towards 2355.80 is expected, which would serve as a local target. Subsequent retesting of 2381.60 from below may occur before the downward movement continues to 2345.00. This bearish scenario is corroborated by the Stochastic oscillator, with the signal line poised to drop from above 80, suggesting a potential decline.
As investors and traders navigate these dynamics, gold’s status as a hedge against uncertainty remains a key theme in its valuation.
Disclaimer
Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.
- COT Bonds Charts: Speculator Bets led by SOFR 3-Months & 10-Year Bonds Dec 21, 2024
- COT Metals Charts: Speculator Bets led lower by Gold, Copper & Palladium Dec 21, 2024
- COT Soft Commodities Charts: Speculator Bets led by Live Cattle, Lean Hogs & Coffee Dec 21, 2024
- COT Stock Market Charts: Speculator Bets led by S&P500 & Russell-2000 Dec 21, 2024
- Riksbank and Banxico cut interest rates by 0.25%. BoE, Norges Bank, and PBoC left rates unchanged Dec 20, 2024
- Brent Oil Under Pressure Again: USD and China in Focus Dec 20, 2024
- Market round-up: BoE & BoJ hold, Fed delivers ‘hawkish’ cut Dec 19, 2024
- NZD/USD at a New Low: The Problem is the US Dollar and Local GDP Dec 19, 2024
- The Dow Jones has fallen for 9 consecutive trading sessions. Inflationary pressures are easing in Canada. Dec 18, 2024
- Gold Holds Steady as Investors Await Federal Reserve’s Rate Decision Dec 18, 2024
