GOLD is breaking bullish structure, pay special attention to Fed

Updated

XAUUSD fell to its lowest level in 2 weeks when demand for the US Dollar in the market recovered.
A Federal Reserve rate cut in September is looking less and less likely, which is causing some selling pressure on gold. Investors will focus on today's (Friday) speech by Federal Reserve Governor Waller, US durable goods orders and the University of Michigan's consumer confidence index report.

Strong U.S. economic data pushed U.S. Treasury yields and the dollar higher, which in turn weighed on gold prices.
S&P Global said the US Composite Purchasing Managers' Index (PMI), which tracks manufacturing and services sector activity, rose to 54.4 in May, its highest level since April 2022.
Other data released on Thursday showed the number of people filing for unemployment benefits in the US fell to 215,000 last week, the biggest two-week drop since last September.

Minutes from a Federal Reserve meeting released Wednesday showed that officials still believe price pressures will gradually ease over at least the next few months, but some officials said they were ready to support spending increases. borrowing costs if inflation spikes.

Notable data and events of the day
Fed Governor Waller is scheduled to speak on Friday. Hawkish comments from Federal Reserve policymakers could put pressure on gold prices. It's worth noting that higher interest rates typically hurt gold prices because they increase the opportunity cost of investing in gold.
In addition, US durable goods orders and the University of Michigan's consumer confidence index will also be published.
The preliminary value of US durable goods orders for April will be published, with the monthly rate expected to decrease by 0.8 %, after increasing 2.6% in March.
The final value of the University of Michigan's Consumer Confidence Index for May will be announced and is expected to be 67.5.

Fed Governor John Waller, who has been hawkish on the Fed's rate-hike cycle, said Tuesday that he would need to see good inflation data for several more months before starting to cut rates.
“In the absence of significant weakness in the labor market, I would need to see good inflation data for several more months before I feel comfortable making a move,” Waller said at the Peterson Institute for International Economics in Washington. support the loose monetary policy stance."
Waller and other Fed officials have recently emphasized that the central bank may need to keep interest rates steady for longer than previously expected. Policymakers have not adjusted the benchmark interest rate, currently at a 23-year high, since last July.

Fundamentally, traders need to pay special attention to the speech of Fed Governor Waller, who is a hawkish Fed official and Waller is very likely to follow up with further comments. causing pressure on gold prices.

Analysis of technical prospects for XAUUSD
On the daily chart, gold broke most of the key technical levels and broke the technical structure that favors the upside.
The drop below the trend and EMA21 is providing further downside risk to gold prices.
In the immediate future, gold has a support at the technical level of 2,325 USD, and in case this technical level continues to be broken, gold will be eligible to move towards the level of 2,305 - 2,300 USD in the short term.
The relative strength index (RSI) is pointing down but is still far from the oversold area, suggesting that gold prices still have room to decline further on the daily chart.
From the technical level of 2,325 USD, the possibility of technical recovery is also limited by the EMA21 level which is currently the closest resistance, noticed by the technical point of 2,344 USD.

During the day, gold's technical outlook leans more bearish with limited recovery and notable price levels are listed below.
Support: 2,324 – 2,305USD
Resistance: 2,344USD

🪙SELL XAUUSD | 2370 - 2368

⚰️SL: 2374

⬆️TP1: 2363
⬆️TP2: 2358

🪙BUY XAUUSD | 2288 - 2290

⚰️SL: 2284

⬆️TP1: 2295
⬆️TP2: 2300

Note

- The US dollar remains, by a very large margin, the world's reserve currency.
- Recent events indicate that the dollar's influence has increased significantly.
- The real return on capital is not appropriate to use to measure long-term neutral interest.
- Real 10-year Treasury yields are a good real proxy for the theoretical value of the neutral interest rate.

Note

GOLD fell last week, the market will pay attention to PCE

Note

Gold prices witnessed a noticeable rise at the beginning of the week’s trading, today, Monday, in an attempt to recover from their lowest level in two weeks, supported by the decline in the US dollar index, in addition to the decline in US bond yields, amid markets’ anticipation of the release of personal consumer spending index data in... The US Federal Reserve's preferred inflation rate is scheduled to be released later this week, which may have a clear impact on the upcoming trading of both the US dollar and gold metal.

Note

Gold prices rose slightly on Monday (May 27) from a two-week low recorded in the previous session, as investors assessed fading hopes of a US interest rate cut ahead of the inflation report. Key findings announced this weekend.

Note

🟢Important statements from the Fed...it takes a lot to take one step

Minneapolis Fed President Neel Kashkari told CNBC on Tuesday that the Fed should wait for more significant progress in inflation before considering cutting interest rates.

Note

- XAUUSD briefly broke below the recent bottom at $2,332 per troy ounce. The price bounced back and has strengthened since then.
- If XAUUSD fails to close above 2,400 USD per troy ounce, the price could retest the support level of 2,300 USD per troy ounce.
- On the contrary, XAUUSD could repeat its all-time high if the price closes above 2,400 USD per troy ounce and challenges 2,450 USD per troy ounce.

Note

🟢The US dollar tops the list of the most profitable major currencies

The US dollar recorded a clear rise and was the largest of the major currencies by up to 0.97%, benefiting from the state of optimism regarding the continuation of high US interest rates for a long period, especially after the statements of a member of the US Federal Reserve from Minneapolis, Neel Kashkari, during his speech at the Global Monetary Policy Forum in London, statements Additional information regarding the course of monetary policy.

Note

🔽The dollar suffers its biggest losses in two weeks after a strong blow from US data

The US dollar witnessed a significant decline during trading on Thursday, as the green currency erased almost all of its gains from the previous session and recorded its largest daily losses in two weeks despite the preliminary revised higher-than-expected reading of growth data in the United States, as the dollar suffered from the impact of another set of data. Negativity.

Note

🟡GOLD STABILIZES TODAY AND IS HEADING TO END THE MAY SESSIONS AT A HISTORIC LEVEL

Gold prices moved in a narrow range during trading on Friday, as the precious metal witnessed many factors that enhanced its stability in trading. However, gold is heading to achieve weekly and monthly profits for the fourth month in a row.

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