XAU/USD Current price: $1,872.85
- Market players maintain the focus on policymakers and hints about future monetary policies.
- US indexes have lost Powell’s inspired momentum and trade in the red on Wednesday.
- XAU/USD is range bound, with buying interest decreasing amid renewed US Dollar demand.
The American Dollar traded with a soft tone throughout the first half of the day, allowing XAU/USD to reach a fresh weekly high of $ 1,886.41 a troy ounce. The tie changed ahead of the US opening, and the Greenback found some demand amid easing US indexes. Still, major pairs held within familiar levels amid the absence of a fresh catalyst. The bright metal currently trades at $1,874.00 a troy ounce.
Market participants focus on central banks and whatever hint policymakers provide on future monetary policies. US Federal Reserve (Fed) Chair Jerome Powell hit the wires on Tuesday and was short of compelling speculative interest in the Fed’s determination to tame inflation at any cost. Powell repeated that they were determined to control inflation and would continue tightening the monetary policy by hiking rates. Still, he reiterated the disinflationary process has begun, fueling hopes for a rate cut by year-end.
Fed officials speaking in different events on Wednesday reaffirmed such a stance, as Fed Governor Lisa Cook noted that, given that inflation is still running high, they would need a restrictive monetary policy for some time. Also, New York Federal Reserve President John Williams said the central bank will keep an eye on data to determine the rate rise path, backing Powell on the idea that they still have more to do on rates.
XAU/USD price short-term technical outlook
The XAU/USD pair is up for a third consecutive day but still trading at the lower end of the previous week’s range. On a daily basis, the risk remains skewed to the downside, as the pair keeps developing well below a now directionless 20 Simple Moving Average (SMA), while the longer ones stay far below the current one. The Momentum indicator gains downward traction and stands at fresh weekly lows, while the Relative Strength Index (RSI) consolidates around 46.
In the near term, and according to the 4-hour chart, XAU/USD offers a neutral-to-bearish stance. The 20 SMA has crossed below the longer ones and maintains a firmly bearish slope, with the pair hovering around it. Attempts to run beyond it met sellers around the 200 SMA, currently at $1,881.50. Finally, technical indicators remain flat, with the Momentum stuck around its 100 level but the RSI consolidating around 38, indicating easing buying interest.
Support levels: 1,860.20 1,847.60 1,835.10
Resistance levels:1,881.50 1,892.30 1,901.00
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD holds comfortably above 1.0400 in quiet trading day
EUR/USD clings to modest daily gains above 1.0400 to begin the new week. Thin trading conditions cause the activity in financial markets to stay subdued in between Christmas and New Year holidays, making it difficult for the pair to gather directional momentum.
GBP/USD retreats from the 1.2600 area amid modest USD demand
GBP/USD trims near-term gains and changes hand at around 1.2580. The US Dollar swings alongside sentiment in the absence of high-tier data releases. The poor performance of Wall Street helps the Greenback recover some ground in the American session.
Gold stabilizes above $2,600 following previous week's choppy action
Gold holds steady above $2,600 after failing to make a decisive move in either direction in the previous week. Growing expectations for a cautious approach to policy easing by the Fed in 2025 limits XAU/USD's upside heading into the New Year holiday.
Three Fundamentals: Year-end flows, Jobless Claims and ISM Manufacturing PMI stand out Premium
Money managers may adjust their portfolios ahead of the year-end. Weekly US Jobless Claims serve as the first meaningful release in 2025. The ISM Manufacturing PMI provides an initial indication ahead of Nonfarm Payrolls.
Bitcoin misses Santa rally even as on-chain metrics show signs of price recovery
Bitcoin (BTC) price hovers around $97,000 on Friday, erasing most of the gains from earlier this week, as the largest cryptocurrency missed the so-called Santa Claus rally, the increase in prices prior to and immediately following Christmas Day.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.