Oct 31, 2022

VOT Research Desk

During Monday’s Asian session, the price of gold (XAU/USD) is still under pressure approaching the $1,638 horizontal support, where it is only modestly offered at this writing.

The market’s recent risk-off sentiment, along with anticipation of the outcomes of the Federal Open Market Committee (FOMC) meeting and the October US jobs data, may have contributed to the yellow metal’s recent downturn.

The US Treasury yields, which serve as a barometer of sentiment, remain directionless following a depressing start, and US equities futures show only modest losses despite the Dow Jones poised for its highest monthly gain since 1976.

Additionally, the US Dollar Index (DXY), which is currently up 0.10% intraday, shows a three-day rise at 110.80.

The US Core Personal Consumption Expenditures (PCE) Price Index’s robust readings on Friday, the Fed’s favoured inflation gauge, may also be putting downward pressure on the price of gold.

However, the sixth consecutive quarter of falling US private consumption adds to concerns about a slower rate hike by the US Federal Reserve (Fed) beginning in December, which will put the US dollar bulls to the test. However, Goldman Sachs economists upgraded their forecast for Fed interest rates and projected a peak of 5% in March.

The CME’s FedWatch Tool, which predicts an 80% possibility of the Fed’s 75 bps rate hike, was on the same line.

In conclusion, gold prices are probably going to stay under pressure even though market participants anticipate signs of slower rate hikes from December during Wednesday’s FOMC meeting.

Gold Technical Analysis

With a prolonged breach below the 50-SMA, bearish MACD signals, and a lower RSI (14), which is not oversold, gold sellers remain optimistic that they may break through the $1,638-area horizontal support, which has held for a week.

Then, a southward movement towards the yearly low in the vicinity of $1,614 and the round $1,600 figure emerge on the table.

The 200-SMA, which was at $1,665 at the time of press, might be reached by the XAU/USD rebound if the 50-SMA resistance near $1,648 is cleared to the upside.

However, the monthly peak of $1,730 is preceded by the 50% Fibonacci retracement of the pair’s decline from September 12-28, which is close to $1,675, challenging the gold purchasers subsequently.

At the outset of the crucial week, gold is still generally in the negative.

Oct 28, 2022

VOT Research Desk

As bears probe the $1,658 mark going into Friday’s European session, the gold price (XAU/USD) consolidates the second weekly uptick.

The yellow metal follows the recent decline in commodities and the Antipodeans in the midst of the US dollar’s recovery in this way. However, as the US 10-year Treasury rates rise to 3.94%, the US Dollar Index (DXY) picks up bids to extend its day’s gains to 110.65.

However, the benchmark bond yields reverse a 10-week upswing that had earlier in the week benefitted gold and stock prices as well as stocks.

 Due to the recent retreat in the hawkish Fed bets, it may be vital to examine the market’s worry ahead of the US Core PCE Price Index for September, which is anticipated to increase to 5.2% from 4.9% before.

As the rumors about the Fed’s easy rate hike in December intensify, the inflation number and the market’s bets on the Fed’s next action become even more crucial.

Aside from the DXY recovery, economic worries about China, one of the biggest consumers of commodities worldwide, combine with geopolitical worries about Ukraine to put downward pressure on the price of XAU/USD.

In response to global monetary tightening, rising prices attributed to the conflict in Ukraine, and China’s abrupt downturn, the International Monetary Fund (IMF) reduced its economic estimates for Asia on Friday.

Gold Technical Analysis

Within a three-day-old bearish channel, the price of gold is still declining as sellers try to break through the $1,657 intermediate support represented by the 100-HMA.

The XAU/USD decline is anticipated to continue given the negative chart formation and the pessimistic RSI (14), which is not oversold.

To limit the short-term downside, the 200-HMA level of $1,649 is placed before the lower line of the indicated channel, which is approximately $1,653.

A convergence of the previously mentioned bearish channel and the previous support line from last Friday, however, presents a difficult problem for gold buyers around $1,670.

The recent swing high near $1,675 can then serve as an additional filter to the north before pointing buyers in the direction of the monthly peak of $1,730.

Oct 27, 2022

VOT Research Desk

The gold price (XAU/USD) is largely trading in a constrained range as market participants wait for new impetus to drive a one-sided move. At about $1,670, the precious metal experienced some light selling pressure, but it has since recovered to $1,660 and is back inside the range.

The balanced auction profile is plotted in a range of $1,660.00-1,671.20. The US dollar index (DXY), meanwhile, is remains range bound after detecting a slight purchasing interest of approximately 109.60.

The 10-year US Treasury rates have somewhat recovered after briefly touching the psychological support level of 4%. Investors have moved to the sidelines in anticipation of the US Gross Domestic Product (GDP) and US Durable Goods Orders data, which has left the market in a very calm state.

Despite the Federal Reserve (Fed) raising interest rates, the US GDP is predicted to expand by 2.4% in the third quarter of CY2022 as opposed to the 0.6% decline that was previously reported.

Additionally, it is anticipated that US durable goods orders would perform better than projected, increasing by 0.6% as opposed to declining by 0.2%.

It is important to keep in mind that core inflation data has been raising over the previous few months, and yet persistent durable goods demand indicates strong demand from families.

Gold Technical Analysis Report

Gold The symmetrical triangular pattern of gold price oscillations indicates a sharp decline in volatility.

The volatility contraction pattern will explode, producing broader ticks and high volume. The high on October 11 is used as a horizontal resistance level of $1,684.05.

The counter is receiving strong support from the 20-period Exponential Moving Average (EMA), which is now at $1,633.16.

The upside bias is still strong even if the Relative Strength Index (RSI) (14) has fallen from the bullish area of 60.00–80.00.

Oct 26, 2022

VOT Research Desk

After a stronger rebound from the crucial support level of $1,650.00, the price of gold (XAU/USD) has increased its gains to about $1,657.50.

The price of the precious metal is anticipated to remain uncertain as investors wait for Thursday’s publication of the US Gross Domestic Product (GDP) figures.

The risk profile is responding inconsistently as the S&P500 futures try to recover from their sharp decline in Tokyo.

The US dollar index (DXY), however, has failed to maintain above the round-level resistance of 111.00, signaling a drop in the allure of safe-haven assets. As investors have abandoned the risk-aversion idea, the beta produced by US Treasuries is hunting for additional downside.

The yield on the US 10-year Treasury has fallen below 4.10%, and the present downward momentum may lead to further pressure in the future.

The announcement of the US GDP report on Thursday is anticipated to cause extreme volatility in gold prices. According to early projections, the US growth rate for the third quarter of CY 2022 is 2.4% as opposed to the previously stated negative rate of 0.6%.

Gold Technical Analysis Report

Gold prices have experienced a significant rebound on an hourly basis after breaking through the horizontal support established from Thursday’s high at $1,640.55. The downward-sloping trend line drawn from the high point of October 13 at $1,682.53 will serve as significant barrier for the gold prices going forward.

Given that the Relative Strength Index (RSI) (14) has moved into the 40.00–60.00 regions, the precious metal is anticipated to exhibit sideways movement in the near future.

The counter is seeing strong support from the 20-period Exponential Moving Average (EMA) at $1,651.50.

Oct 24, 2022

VOT Research Desk

Early on Monday morning in Europe, the gold price (XAU/USD) was under pressure at the intraday low of $1,652, maintaining the week’s start down from a fortnight high.

Thus, the yellow metal supports both the stronger US dollar and the cautious market sentiment. As of press time, the US Dollar Index (DXY) is up 0.30% day-to-day to 112.25 amid rumors that Japan is interfering in the market to protect the yen and problems with risk appetite. The gold price significantly increased on Friday, marking the first weekly gain in three weeks as the aggressive Fed bets back off following a mixed Fed speak.

James Bullard, president of the St. Louis Federal Reserve, stated I want rates that put considerable downward pressure on inflation. Charles Evans, president of the Chicago Fed, concurred, saying that they will need to hike rates much more and keep them there for a while.

However, according to Nick Timiraos, Chief Economics Correspondent at The Wall Street Journal (WSJ), the Federal Reserve officials will likely debate whether and how to signal plans to approve a smaller increase in interest rates in December at their meeting in November as they head toward another interest-rate increase of 75 basis points. In the near future, gold traders should anticipate continued losses due to volatile markets and challenges to mood.

The XAU/USD downside may be threatened by the Fed speakers’ absence and an expected hawkish response from the European Central Bank (ECB).

Gold Technical Analysis

The 21-DMA resistance is broken by the gold price as a result of bearish MACD and slow RSI signals, which points to additional gold price decreases toward the resistance-turned-support line from October 6 at roughly $1,630 at the time of this writing.

However, the monthly horizontal support at $1,620, followed shortly by the yearly bottom of $1,614, can be a problem for the gold bears.

If the price of metals falls below $1,614, the $1,600 level and the 61.8% Fibonacci Expansion (FE) of the movements from June to October, which is approaching $1,565, would entice the XAU/USD bearish.

Instead, the 21-DMA and the 50-DMA, respectively at $1,665 and $1,694 protect the short-term rebound of the gold price.

The monthly high at $1,730 and the round $1,700 mark after that would be intriguing to keep an eye on for potential future gains.