Gold Price Forecast: XAU/USD refreshes day’s high above $1,930 ahead of Fed’s preferred inflation gauge


  • Gold price has refreshed its day high at $1,935.00 amid a volatile USD Index.
  • The Fed is expected to hike interest rates by 25 bps to 4.50-4.75% next week.
  • Gold bulls need immense strength to take out pessimism as the higher-low structure has messed up.

Gold price (XAU/USD) has refreshed its day’s high at $1,935.00 in the Asian session. The precious metal picked strength after a minor drop below $1,930.00, which poised a bargain opportunity for gold buyers. The US Dollar Index (DXY) slipped sharply after failing to surpass the critical hurdle of 101.80.

The USD Index dropped to near 101.40 and is likely to remain on tenterhooks ahead of the release of the Federal Reserve (Fed)’s most preferred inflation tool, the United States Personal Consumption Expenditure (PCE) Price Index (Dec). The economic data is seen rising by 0.3% vs. 0.2% reported earlier.

Meanwhile, the risk profile is displaying dubious outcomes as S&P500 futures are showing decent losses after an upbeat Thursday trading session. While the risk-perceived currencies are showing immense strength.

Gold price could face a squeeze in volatility as investors are broadly shifting their focus towards the announcement of the interest rate decision by Fed chair Jerome Powell next week. As per the CME FedWatch tool, the chances of a 50 basis point (bps) interest rate hike are less than even 1%. Therefore, the borrowing rates might escalate to 4.50-4.75%.

Gold technical analysis

Gold price is auctioning in a Rising Wedge chart pattern on an hourly scale, which indicates a volatility contraction on a broader note. The precious metals displayed a responsive buying action after dropping below January 25 low at $1,919.91, recorded a lower low, however the expression of the lower low is weak as buyers jumped in and demonstrated a firmer buying interest. But, one cannot deny the fact that the structure has messed up and the Gold bulls will require immense strength to remain in a positive trajectory.

The Gold price has recovered to near the 20-period Exponential Moving Average (EMA) at $1.933.16. Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in a 40.00-60.00 range, which indicates a consolidation ahead.

Gold hourly chart

XAU/USD

Overview
Today last price 1932.9
Today Daily Change 3.18
Today Daily Change % 0.16
Today daily open 1929.72
 
Trends
Daily SMA20 1890.99
Daily SMA50 1825.69
Daily SMA100 1753.19
Daily SMA200 1775.5
 
Levels
Previous Daily High 1949.27
Previous Daily Low 1918.67
Previous Weekly High 1937.57
Previous Weekly Low 1896.63
Previous Monthly High 1833.38
Previous Monthly Low 1765.89
Daily Fibonacci 38.2% 1930.36
Daily Fibonacci 61.8% 1937.58
Daily Pivot Point S1 1915.84
Daily Pivot Point S2 1901.95
Daily Pivot Point S3 1885.24
Daily Pivot Point R1 1946.44
Daily Pivot Point R2 1963.15
Daily Pivot Point R3 1977.04

 

 

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