GOLD rebound and limited, trading week with ChristmasUS economic data shows inflation is slowing. Supported by the weakening of the TVC:DXY and US Treasury bond interest rates, OANDA:XAUUSD continued to increase on Friday (December 18). However, the Fed's hawkish interest rate outlook caused gold prices to fall 0.9% last week.
The Federal Reserve's headline inflation index (PCE) showed price pressures eased last month.
According to data released by the US Bureau of Economic Analysis (BEA), the core personal consumption expenditures (PCE) index, excluding food and energy prices, increased by 0.1% over the previous month. in November, slower than the 0.3% increase in October. The increase was slightly lower than economists' expectations of 0.2%.
On a yearly basis, core PCE rose 2.8%, matching the increase in October and below Wall Street expectations of 2.9%. Overall PCE increased 2.4% year-over-year, up from 2.3% in October.
Earlier this month, the core Consumer Price Index (CPI), which excludes food and gas prices, showed prices rose 3.3% year-on-year in November, marking the fourth straight month of increases.
Meanwhile, the core Producer Price Index (PPI), which tracks price changes across companies, showed prices rose 3.4% year-on-year in November. The increase was higher October's 3.1% increase also exceeded economists' expectations of 3.2%.
At a press conference following Wednesday's interest rate decision, Fed Chairman Jerome Powell said the final phase of the Fed's response to inflation will be more difficult than initially expected.
“We were forecasting inflation at the end of the year, but as we got closer to the end of the year, the forecast was off a little bit,” Powell said. “I would say that's probably the biggest factor, inflation is once again missing expectations.”
So far this year, inflation has slowed but remains above the Fed's 2% target, pressured by recent unexpectedly hot monthly "core" price growth data.
According to the Fed's latest Summary of Economic Projections (SEP), the Fed expects core inflation to peak at 2.5% next year, up from a forecast of 2.2% in September and falling to 2.0%. 2% in 2026 and 2027 to 2.0%.
Higher inflation expectations, coupled with a slower pace of interest rate cuts next year, have weighed on markets.
On the other hand, the election of Donald Trump as the next president has added to this uncertainty, with some economists suggesting that the United States could face another surge in inflation if Trump makes his move. True to his campaign promises.
Policies proposed by Trump such as imposing high tariffs on imported goods, cutting taxes on businesses and restricting immigration could have an inflationary effect. These policies further complicate the Fed's future interest rate path.
Data and events this week
The market will also welcome the Christmas holiday this week, traders will focus on important events such as "where to get money to buy gifts for bears, where to go so as not to eat dog food, or open the door." Is it a pan or a greeting, honey,... I don't know but I wish you all a happy Christmas and good health hehe." However, some important economic data will be released.
Economic data to watch out for this week
Monday: US consumer confidence
Tuesday: US sustainable goods, US new home sales
Wednesday: Christmas break
Thursday: US weekly unemployment claims
Analysis of technical prospects for OANDA:XAUUSD
Gold recovered from the 0.786% Fibonacci level during the weekend trading session, but the recovery is also limited after testing the target resistance level noted by readers in the previous issue at the confluence of the upper edge. price channel and Fibonacci level 0.618%.
Currently, the closing position still supports the possibility of a technical bearish price for gold, with the price channel as the main trend price channel, resistance from Fibonacci 0.618% and pressure at Ema21.
On the other hand, the Relative Strength Index is still operating below the 50 level, quite far from the oversold area, which shows that there is still quite a lot of room for price decline ahead.
As long as gold remains below EMA21, within price channel, it still has a bearish technical outlook and the notable points are listed below.
Support: 2,591 – 2,552 – 2,538USD
Resistance: 2,634 – 2,656USD
SELL XAUUSD PRICE 2646 - 2644⚡️
↠↠ Stoploss 2650
→Take Profit 1 2639
↨
→Take Profit 2 2634
BUY XAUUSD PRICE 2604 - 2606⚡️
↠↠ Stoploss 2600
→Take Profit 1 2611
↨
→Take Profit 2 2616
