Gold Price Forecast: XAU/USD wavers between two key averages after the CPI blow, awaits US data

Gold attempts a bounce as US Treasury yields retreat.
US dollar’s haven demand remains intact as inflation concerns lurk
Gold remains at the mercy of USD dynamics, awaits fresh US data.

Dhwani Mehta FXStreet

After witnessing a choppy trend, in the first half of Wednesday’s trading, Gold (XAU/USD) tumbled to fresh three-day lows of $1813 after a big beat on the US inflation data jolted the dollar higher towards 91.00 against its main competitors. A bigger-than-expected jump in the US CPI data intensified concerns over mounting inflationary pressures, which spooked the investors and bolstered the dollar’s safe-haven appeal. The rally in the US Treasury yields also collaborated with the downside in gold, as speculative interest re-ignited the Fed tightening expectations. However, the sell-off in the US stocks helped limit gold’s downside.

Gold is struggling to extend its bounce so far this Thursday, with the risk-off mood capping the gains, as the US dollar continues to remain the most preferred safe-haven asset. The price of gold, although draws support from a retreat in the US yields, in the wake of reduced demand for riskier assets. The US dollar dynamics will continue to influence the gold price action, as markets look forward to the US Producers Price Index (PPI) and weekly Jobless Claims.

Gold Price Chart - Technical outlook

Gold: Four-hour chart

Despite Wednesday’s pullback from near $1850 levels, the gold price has managed to defend the upward-sloping 50-simple moving average (SMA) support at $1811.

Gold prices need to recapture the 21-SMA at $1832, in order to extend the recovery momentum towards the static resistance around $1845-$1850.

The Relative Strength Index (RSI) has edged higher but remains below the midline, suggesting that the buyers are likely to face a hard time.

A sustained break below the 50-SMA support could expose the $1800 threshold.

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to Premium Sign In

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

EUR/USD weakens to four-week lows near 1.1750

EUR/USD’s selling pressure is gathering pace now, approaching the area of multi-week troughs in the mid-1.1700s on Thursday. The pair’s intense decline comes on the back of another day of solid gains in the US Dollar, particulalry exacerbated following firm prints from the weekly US labour market.

GBP/USD drops further, hovers around 1.3460

In line with the rest of its risk-linked peers, GBP/USD faces increasing selling pressure and recedes toward the 1.3460 region, or four-week lows, on Thursday. Cable’s persistent pullback comes in response to the continuation of the recovery in the Greenback amid a solid US data and a divided FOMC when it comes to the Fed’s rate path.

Gold clings to daily gains near $5,000

Gold struggles for direction and clings to its daily gains around the key $5,000 mark per troy ounce on Thursday. The precious metal sticks to the bid bias amid reignited geopolitical tensions in the Middle East and despite marked gains in the US Dollar and rising US Treasury yields across the curve.

Ripple slips toward $1.40 despite SG-FORGE tapping protocol for EUR CoinVertible

XRP extends its decline, nearing $1.40 support, as risk appetite fades in the broader market. SG-FORGE’s EUR CoinVertible launches on the XRP Ledger, leveraging the blockchain’s scalability, speed, security, and decentralization.

Hawkish Fed minutes and a market finding its footing

It was green across the board for US Stock market indexes at the close on Wednesday, with most S&P 500 names ending higher, adding 38 points (0.6%) to 6,881 overall. At the GICS sector level, energy led gains, followed by technology and consumer discretionary, while utilities and real estate posted the largest losses.

Injective token surges over 13% following the approval of the mainnet upgrade proposal

Injective price rallies over 13% on Thursday after the network confirmed the approval of its IIP-619 proposal. The green light for the mainnet upgrade has boosted traders’ sentiment, as the upgrade aims to scale Injective’s real-time Ethereum Virtual Machine architecture and enhance its capabilities to support next-generation payments.