The gold price is aiming for the critical resistance level of $2,050.00 as the USD Index continues to fall.
The gold price (XAUUSD) is gaining strength as it approaches the critical resistance level of $2,050.00 in the Asian session.
After experiencing mild exhaustion in the upward momentum. The precious metal is looking to resume its upward journey. After seeing stellar buying on Thursday. S&P500 futures are showing choppy moves in the Asian session. Indicating a risk appetite theme supported by market participants.
The US Dollar Index (DXY) has retested its 11-month low of 100.80 and is expected to fall further as investors anticipate that the Federal Reserve (Fed) will consider pausing rate hikes following its May monetary policy meeting.
Reduced Fed borrowing by US banks suggests a further slowdown in the US economy.
According to Bloomberg, US commercial banks reduced their borrowings from two Federal Reserve lending facilities for the fourth week in a row as liquidity constraints eased. Silicon Valley Bank went bankrupt last month. Lower credit disposal due to tight credit conditions may slow the US economy. Allowing inflationary pressures to ease sooner and forcing Fed chair Jerome Powell to end the policy-tightening cycle sooner.
Moreover The USD Index is expected to surge on Friday in response to the release of US Retail Sales data. The economy will contract by 0.4%, according to the consensus. As the US labor market cools, retail demand is likely to maintain the pace of contraction seen in February.
Gold Technical Outlook
The gold price is auctioning in a Rising Channel chart pattern on a scale. With every pullback capitalized for market participants to build new longs. The yellow metal is settling near the breakout region of the previously mentioned chart pattern.
Furthermore The advancing 20-period Exponential Moving Average (EMA) at $2,031.00 suggests that gold bulls can expect more gains.
The Relative Strength Index (RSI) (14) is currently oscillating in the bullish range of 60.00-80.00. Indicating that the uptrend is already in full swing.
Gold Daily Trends
Daily SMA20 | 1984.88 |
Daily SMA50 | 1905.21 |
Daily SMA100 | 1872.96 |
Daily SMA200 | 1792.38 |