XAU/USD Current price: $1,974.84
- Market players await news on the US debt ceiling, doubt about Fed’s next move.
- Federal Reserve officials suggest it is not yet time for a pause.
- XAU/USD consolidates Friday’s gains but lacks directional momentum.
Spot Gold is under mild pressure at the beginning of the week, with XAU/USD trading at around $1,975 a troy ounce. The bright metal, however, hovers at the upper end of Friday’s range as financial markets await a fresh catalyst.
Speculative interest has one eye on US debt-ceiling talks and whether progress can be achieved before a potential default on June 1. At the time being, there’s no agreement on significant items, although discussions will continue throughout the day.
At the same time, tensions mount ahead of the release of the FOMC Meeting Minutes next Wednesday and as multiple Federal Reserve (Fed) speakers hit the wires. Federal Reserve Bank of St. Louis President James Bullard said he believes the central bank will have to go higher on the policy rate, adding that he is expecting at least two more 25 bps rate hikes. Minneapolis Fed President Neel Kashkari, however, noted that whether to hike or pause is a close call, adding that he is willing to hold rates steady to give officials more time to assess the effects of past rate increases.
Finally, Federal Reserve Bank of San Francisco President Mary Daly noted that “tighter credit conditions may be akin to one to two rate hikes,” adding policymakers must be very data-dependent. Financial markets are betting the US central bank will refrain from hiking rates in June and July amid concerns that further tightening will damage the financial system.
XAU/USD price short-term technical outlook
The daily chart for the XAU/USD pair shows that the risk remains skewed to the downside. Technical indicators remain within negative levels, with the Momentum heading firmly south and at fresh two-month lows. The Relative Strength Index (RSI) indicator, in the meantime, lacks directional strength at around 44. At the same time, the 20 Simple Moving Average (SMA) grinds lower well above the current level, while the longer moving averages maintain their upward slopes below it.
The near-term picture is neutral-to-bearish. The pair is seesawing around a bearish 20 SMA while below the longer ones, which lack directional strength. At the same time, technical indicators head nowhere just below their midlines, reflecting limited buying interest. Friday’s high at $1,984.16 is the level to watch on the upside, as a break above it could lead to a test of the $2,000 threshold.
Support levels: 1,961.60 1,944.00 1,932.10
Resistance levels: 1,984.20 1,996.80 2,008.30
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
GBP/USD stays pressured below 1.3300 after UK Retail Sales data
GBP/USD remains under moderate selling pressure below 1.3300 despite the upbeat UK Retail Sales data for March. The pair feels the heat of the solid US Dollar rebound, aided by a Bloomberg report, which indicated China may suspend its 125% tariff on select US imports.
EUR/USD slides toward 1.1300 as US Dollar jumps on US-China trade optimism
EUR/USD extends the drop toward 1.1300 in European trading on Friday. Broad US Dollar resurgence on optimism surrounding the US-China trade war de-escalation weighs heavily on the pair. Trade talks and US data remain in focus.
Gold price drifts lower as US-China trade deal hopes undermine safe-haven assets
Gold price bulls seem reluctant as a positive risk tone undermines demand for safe-haven assets. Thursday’s upbeat US macro data supports the USD, contributing to capping the precious metal. Geopolitical uncertainties and Fed rate cut bets should help limit losses for the XAU/USD pair.
Ethereum: Accumulation addresses grab 1.11 million ETH as bullish momentum rises
Ethereum saw a 1% decline on Friday as sellers dominated exchange activity in the past 24 hours. Despite the recent selling, increased inflows into accumulation addresses and declining net taker volume show a gradual return of bullish momentum.
Five fundamentals for the week: Traders confront the trade war, important surveys, key Fed speech Premium
Will the US strike a trade deal with Japan? That would be positive progress. However, recent developments are not that positive, and there's only one certainty: headlines will dominate markets. Fresh US economic data is also of interest.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.