Gold Price Prediction-$1950 level holds Key for downward Momentum. The Dollar Index (DXY) continues to control the price of gold (XAUUSD).
GOLD OUTLOOK FOMC NOTES, AND INCREASING TREASURY YIELDS & GDP IN FOCUS
A combination of higher US Treasury Yields and a stronger US currency impacted on gold prices Tuesday, causing them to decline. Prior to a strong dip that had gold prices conclude the day’s trading around the $1957/oz level. The early portion of the US session looked hopeful as Gold recovered towards earlier resistance at the $1983–$1985 range. The dollar’s strength graph down below, which shows that the USD was the most powerful currency once the market opened. It shows that the European Opening caused minimal change.
Graph Source: FinanciaJuice
US first-quarter 2023 GDP (following reading): 1.3%, up from the anticipated 1.1%
Bulls and bears have been vying for place in the recent gold market struggle, but neither side has so far managed to win. Prices are stuck between the $1950 and $2050 levels, and any movement seems to be fleeting lacking a continuation through. The $1950 support region has been resisting a bearish a turning point in the price action over a daily basis for the past ten days or so.
US Debt ceiling still an issue
Prices continue to fluctuate due to the US officials’ failure to reach a consensus on the US debt ceiling. The US ‘AAA’ Long-Term Foreign-Currency Issuer Default Rating (IDR). – Had been placed on Rating Watch Negative by Fitch Ratings Agency Thursday. Let us assume this is the final push that officials need to reach a compromise. Although knocking out raising taxes on the wealthiest and stressing that quite a few of harms had already been produced. House Representative Kevin McCarthy stayed somewhat upbeat during his comments during a press briefing.
In addition, despite a number of recent hardline statements from officials. The Fed’s latest minutes release did not offer any more clarification on the monetary policy of the US. The key conclusions from the minutes are that managers are divided between wanting to keep raising or to stop now. Prior to the Fed’s June meeting, we will undoubtedly receive the latest PCE figures along with one more CPI data. Both of which might be crucial for determining the next course of action for the Fed.
There is a sizable amount of data from the United States on the table today for the 1950 support region.
Economic Activity Schedule
Gold Technical Perspective
Technically speaking, Gold’s price movement has been indicating additional fall for some time. But the bigger macro image in action has largely obscured this. The shooting star from yesterday and the marubozu candlestick finish give bears enough cause to be happy.
At this point, the $1950 mark still acts as an obstacle to further declines, with a daily candle closure under it. Possibly triggering a test of the 100-day (MA) at the $1935 level. Some doubts about if such a move can be made in the absence of an explicit deal or a default on the debt ceiling. There is a strong likelihood that the present immediate band between $1950 and $1985, with price swings. Push additional information about the discussions becomes available, will keep steady till June 1.
Major Levels (Intraday)
Support Levels:
- 1950
- 1935 (100-day MA)
- 1925
Resistance Levels:
- 1970
- 1983
- 2000 (psychological level)
