Gold Price Forecast: XAU/USD faces some consolidation ahead of key week

Spot Gold trades in an inconclusive fashion at the beginning of the week, as markets participants continued to gauge the results of the French elections on June 30, while key US data releases, the speech by Chair Powell and the ECB Forum in Portugal are all expected to keep price action around the precious metal under scrutiny in the upcoming few days.

Meanwhile, the dominating appetite for the risk-linked complex keeps the Greenback on the defensive, although the marked rebound in US yields across the curve prevents the yellow metal from gathering more convincing upside traction for the time being.

In the meantime, the US Dollar maintains its bearish stance after the final S&P Global Manufacturing PMI came in at 51.6 in June, while Construction Spending contracted by 0.1% in May vs. the previous month, and the always relevant ISM Manufacturing PMI retreated to 48.5 in the last month.

Moving forward, investors and the yellow metal are expected to closely follow Chief Powell’s participation at the ECB Forum in Sintra (Portugal) on July 2, the publication of the FOMC Minutes of the June 12 gathering and, finally, the release of the crucial Nonfarm Payrolls on July 5, all bearing in mind the potential interest rate path by the Fed in the latter part of the year.

XAU/USD short-term technical outlook

XAU/USD hovers around $2,330, and the daily chart shows the continuation of the consolidative phase for the time being. So far, the yellow metal should meet initial contention at the June low of $2,287. While the provisional 55-day SMA favours further range bound trade, both the 100-day AND 200-day SMAs at $2,258 and $2,123, respectively, suggest further upside might be on the table. In the same line, the Relative Strength Index (RSI) indicator surpassed the 50 threshold and kind of underpins the latter view.

Looking at the 4-hour chart, XAU/USD also looks side-lined in the short-term horizon. However, technical indicators keep pointing upward and seem to favour some fresh buying interest. The surpassing of recent tops around $2,340 should unveil a potential challenge to the key 200-SMA around $2,345.

Support levels: 2,308.30 2,293.50 2,279.60 

Resistance levels: 2,337.00 2,344.25 2,368.76