- Gold price hits a daily high of $1996.73 but loses momentum in the aftermath of a mixed US inflation report.
- US Bureau of Labor Statistics (BLS) reveals disinflation in the US, with annual and monthly readings posting mixed results.
- Traders await the Federal Reserve’s decision, with money market futures expecting the Fed to hold rates, eyeing 100 basis points of rate cuts for 2024.
Gold price lost its bright after hitting a daily high of $1996.73, though it dropped in the aftermath of a softish inflation report in the United States (US), ahead of the upcoming Federal Reserve (Fed) monetary policy decision. The XAU/USD exchanges hands at $1979,40, down 0.11%
The yellow metal losses momentum ahead of the upcoming Fed’s decision
The US Bureau of Labor Statistics (BLS revealed the disinflation process in the US continues, as headline inflation was 3.1% YoY, below October’s 3.2%, but underlying inflation remains stickier at 4% in the twelve months to November. Monthly readings were mixed, with CPI standing at 0.1%, exceeding forecast by 0%, while core CPI was 0.3% as expected but higher than in October.
The data release underpinned Gold’s towards its daily high, though pared its gains, slumping below the $1985 mark, weighed by a recovery of US Treasury bond yields. Even though the Greenback (USD) remains soft as depicted by the US Dollar Index (DXY), down 0.23% at 103.85, the yellow metal remains unable to recover from its late losses.
Meanwhile, traders brace for the Federal Reserve’s decision on Wednesday, followed by Chairman Jerome Powell’s press conference. Despite inflation’s positive reading, money market futures had priced in 100 basis points of rate cuts for 2024 and remain cautious. Earlier in that day, the BLS would announce prices paid by producers.
XAU/USD Price Analysis: Technical outlook
Gold’s daily chart depicts the yellow metal is neutral to upward biased as long as it stays above the daily moving averages (DMAs). Nevertheless, as XAU/USD continues to drop, that would put into play the 50-DMA at $1966.41, followed by the 200-DMA at $1952.74. Further support lies at the 100-DMA at $1941.07. Once those levels are cleared, the XAU/USD would shift downwards. On the other hand, a bullish resumption looms, but bulls need to lift the spot price above the October 27 high at $2009.42.
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 trades at yearly lows below 1.0500 ahead of PMI data
EUR/USD stays on the back foot and trades at its lowest level since October 2023 below 1.0500 early Friday, pressured by persistent USD strength. Investors await Manufacturing and Services PMI surveys from the Eurozone, Germany and the US.
GBP/USD falls to six-month lows below 1.2600, eyes on key data releases
GBP/USD extends its losses for the third successive session and trades at a fresh fix-month low below 1.2600. This downside is attributed to the stronger US Dollar (USD) as traders continue to evaluate the Fed's policy outlook following latest data releases and Fedspeak.
Gold rises toward $2,700, hits two-week top
Gold continues to attract haven flows for the fifth consecutive day and rises toward $2,700. XAU/USD continues to benefit from risk-aversion amid intensifying Russia-Ukraine conflict. Investors keep a close eye on geopolitics while waiting for PMI data releases.
Ripple surges to a new yearly high; XRP bulls aim for three-year high of $1.96
Ripple extends its gains by around 10% on Friday, reaching a new year-to-date high of $1.43 and hitting levels not seen since mid-May 2021. The main reasons behind the rally are the announcement that the US SEC's Chair Gary Gensler will resign and the launch in Europe of an XRP ETP by asset management company WisdomTree.
A new horizon: The economic outlook in a new leadership and policy era
The economic aftershocks of the COVID pandemic, which have dominated the economic landscape over the past few years, are steadily dissipating. These pandemic-induced economic effects are set to be largely supplanted by economic policy changes that are on the horizon in the United States.
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.