Gold Price Forecast: XAUUSD awaits US CPI for a fresh upswing

• Gold price is fading the rebound but holds above the $1,700 mark.   
• The US Dollar resumes its correction but a weak CPI print could revive the downside.
•  XAUUSD buyers gather strength before the next push higher.

Gold price is posting small gains above the $1,700 mark, as bulls turn cautious ahead of the critical Consumer Price Index (CPI) from the United States. The US inflation data is of utmost significance in determining the US Federal Reserve’s rate hike outlook. A softer US core CPI print is likely to bolster expectations of a 50 bps December Fed rate hike. The monthly US CPI is seen rising to 0.6% while the annualized inflation rate is seen softening to 8.0%. The Core CPIs are likely to ease across the time horizon, suggesting signs of peak inflation. Gold price could resume its uptrend on a softer US CPI-induced renewed US Dollar weakness and a risk rally. Markets are currently pricing a 57% probability of a 50 bps December Fed rate hike.

Gold Price: Key levels to watch

The Technical Confluence Detector shows that the gold price is facing a wall of stiff resistance levels at around $1,710. At that level, the Fibonacci 38.2% one-day coincides with the SMA10 four-hour.

The next upside target is seen at the previous high four-hour at $1,713, above which a test of the $1,715 level cannot be ruled out, where the Fibonacci 61.8% one-day and SMA100 one-day meet.

Alternatively, a sustained break below the Fibonacci 23.6% one-day at $1,706 will revive the selling momentum toward the previous low four-hour at $1,704.  

The last line of defense for Gold price is seen at the confluence of the pivot point one-month R1 and one-week R1 at $1,703.

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Gold Price Forecast: XAU/USD holds steady above $1,650 ahead of the key Fed decision

• Gold edges higher for the second straight day amid modest USD weakness.
• Hopes for a less hawkish Fed continue to exert pressure on the greenback.
• The upbeat US ADP report fails to impress the USD bulls or provide impetus.
• The market focus remains on the crucial FOMC monetary policy decision.

Gold gains some positive traction for the second successive day on Wednesday and maintains its bid tone through the early North American session. The XAU/USD is currently placed near the top end of its daily range, just above the $1,655 level, as traders keenly await the highly-anticipated FOMC monetary policy decision.

In the meantime, expectations for a less hawkish Fed prompt fresh US dollar selling, which, in turn, is seen offering some support to the dollar-denominated gold. Market participants expect that the US central bank might slow the pace of its rate-hiking cycle amid the deteriorating outlook for the US economy. Even the upbeat ADP report, showing that private-sector employers added 239K jobs in October against 193K expected, fails to boot the USD.

Despite the supporting factor, the XAU/USD lacks bullish conviction ahead of the crucial central bank event risk. The Fed will announce its policy decision later during the US session and is expected to deliver another supersized 75 bps rate hike for the fourth time in as many meetings. The market focus, however, will remain glued to the accompanying monetary policy statement and Fed Chair Jerome Powell's comments at the post-meeting press conference.

Investors will look for fresh clues about the pace of future policy tightening by the Fed, which will play a key role in influencing the USD price dynamics. This, in turn, will help determine the next leg of a directional move for the non-yielding gold. The current market pricing indicates over a 50% chance of a 50 bps Fed rate hike move in December. A more hawkish signal will set the stage for the resumption of the recent bearish trend for the XAU/USD.

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Gold Price Forecast: XAUUSD pressured as core PCE jumps, justifying further Fed action

• Gold price records a fresh three-day low spurred by a strong US Dollar.
• The Fed’s preferred gauge for inflation, the Core PCE, smashed estimates, justifying additional action.
•  US Treasury bond yields jumped, with the 10-year eyeing to recoup the 4% threshold.

Gold price slides and extends its losses below $1650 due to stubbornly high US inflation reported namely the Core Personal Consumption Expenditures (PCE), the Federal Reserve’s favorite gauge of inflation, which increased more than estimates, bolstering the US Dollar. Therefore, the XAUUSD is trading at $1641.62, diving 1.23%, eyeing the weekly lows of around $1638.

The Fed’s gauge of inflation justifies additional tightening

On Friday, the US Commerce Department revealed that September’s US inflation, as measured by the Core PCE, which strips volatile items like food and energy, jumped 0.5% MoM, higher than the previous reading, while annually based, escalated by 5.1%, above 4.9% forecasts by street’s analysts. In a separate report, the Employment Cost Index (ECI), an indicator used by the Fed in addressing inflation on wages, increased by 1.2% in the July-September period, as reported by the Department of Labor.

Given the backdrop, the so-called Fed pivot narrative could be tossed away as inflation remains stubbornly high and salaries are rising, despite the Federal Reserve’s effort to tame inflation.

Of late, additional US economic data was reported, with the University of Michigan (UoM) Consumer Sentiment unchanged at 59.9. Consumer’s inflation expectations for the 1-year horizon easied from 5.1% to 5%, and for a 5-years and beyond, were unchanged at 2.9%.

US Dollar bolstered on PCE data, Federal Reserve meeting eyed

After the data was released, the XAU remained on the defensive, as the reasons above will justify further Fed tightening. The US Dollar Index, a measure of the buck’s value against six currencies, is up 0.20%, at 110.78, while US Treasury yields, namely the 10-year benchmark rate, recover five bps up at 3.973%.

In the meantime, Wall Street holds to gains amidst a decent earnings season, keeping US equities in the green.

Now market participants turn to the next week’s Federal Reserve Open Market Committee (FOMC), in which most analysts expect the Fed to hike rates by 75 bps, as reported by the CME FedWatch Tool, with odds at an 84.5% chance. However, December’s meeting is split between 50 or 75 bps, with the majority of the investors

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Gold Price Forecast: XAU/USD to remain vulnerable amid climbing yields and strong dollar – Commerzbank

Gold price is on the retreat again. Strategists at Commerzbank expect the yellow metal to stay offered as rising yields lift the dollar.

US interest rate at its highest level since August 2009

“The renewed price weakness was triggered by a noticeably stronger US dollar again and rising bond yields as further pronounced rate hikes by the Fed are anticipated. This puts the real US interest rate using market-based inflation expectations at 1.7%, its highest level since August 2009. This makes gold less attractive as a non-interest-bearing investment.”

“For as long as the headwind generated by the US dollar and climbing (real) yields persist, gold is likely to remain on the defensive.”

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Gold Price Forecast: XAU/USD rebounds from YTD low, upside potential seems limited

Gold reverses an intraday slide to its lowest level since April 2020 amid a modest USD pullback.

Recession fears, a softer risk tone further extend some support to the safe-haven commodity.

Bets for more aggressive Fed rate hikes to limit the USD downfall and cap gains for the metal.

Gold stages a goodish bounce from its lowest level since April 2020 touched earlier this Monday and climbs to a fresh daily high during the early European session. Bulls, however, struggle to capitalize on the move beyond the $1,650 level and remain at the mercy of the US dollar price dynamics.

In fact, the USD Index, which measures the greenback's performance against a basket of currencies, surrenders its early gains to a fresh two-decade high amid a recovery in the European currencies. This, in turn, assists the dollar-denominated gold to attract some buyers near the $1,626 region. Apart from this, the prevalent cautious market mood, amid worries about a deeper global economic downturn, turns out to be another factor offering support to the safe-haven precious metal.

The attempted recovery, however, lacks follow-through buying, warranting caution before positioning for any meaningful upside. The Fed last week delivered another supersized rate hike and signalled that it will likely undertake more aggressive increases at its upcoming meetings to tame inflation. A more hawkish stance adopted by the US central bank remains supportive of elevated US Treasury bond yields and should limit any meaningful USD corrective slide, at least for the time being.

The yield on the rate-sensitive 2-year US government bond stands tall near a 15-year high and the benchmark 10-year Treasury note hits the highest in 11 years. This might further contribute to keeping a lid on the non-yielding gold. In the absence of any relevant economic data from the US, traders will take cues from speeches by influential FOMC members. This, along with the US bond yields, the USD price dynamics and the broader risk sentiment might provide some impetus to gold.

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Gold Price Forecast: XAU/USD lifted by Putin, Fed to knock it down – TDS

Gold capitalized on safe-haven flows and climbed above $1,670 as investors seek refuge as Russian President Vladimir Putin announces military mobilization. But eyes are on the Federal Reserve. A hawkish hike is set to weigh on the yellow metal, strategists at TD Securities report.

FOMC to provide more hawkish signals

“Gold is catching a safe-haven bid as Russia has escalated the war in Ukraine with Putin declaring a partial mobilization in Russia and threatening use of nuclear weapons. Nonetheless, it is Fed day, where aggressive Fed expectations are being priced in.”

“The persistence of inflation continues to support an aggressive effort by the Fed, and we expect the FOMC to deliver its third consecutive 75 bps rate hike, bringing the policy stance decidedly above its estimate of the longer-run neutral level. We also look for the Committee to provide more hawkish signals through the update of its economic projections and for Chair Powell to build on his Jackson Hole message.” 

“While prices are certainly weak, precious metals' price action could still have further to fall as the restrictive rates regime is set to last for longer. Indeed, gold and silver prices have tended to display a systematic underperformance when markets expect the real level of the Fed funds rate to rise above the neutral rate, as estimated by Laubach-Williams.”

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Gold Price Forecast: XAU/USD remains poised to test $1,688 key support

Gold price is licking its wounds near $1,700 after Tuesday’s sharp sell off.

The US dollar retreats amid a USD/JPY slide and a pause in the yields rally.

XAU/USD looks south amid a wall of powerful resistance levels.

Gold price is consolidating the previous sell off, as bears are taking a breather before resuming the next leg lower. A pause in the US Treasury yields rally combined with a broad US dollar retreat is offering a temporary reprieve to gold buyers. The bright metal remains vulnerable amid the revival of hopes for aggressive Fed tightening in the coming months. The US inflation data outpaced estimates and squashed the ‘peak inflation’ narrative, suggesting that the Fed will continue with bigger and more rapid rate hikes to control inflation. According to the CME FedWatch Tool, markets are now pricing a 36% chance of a full percentage point Fed rate hike next week. Attention now turns towards the US key events in the second half of the week for fresh trading opportunities in the bullion.

Gold Price: Key levels to watch

The Technical Confluence Detector shows that the gold price is eyeing a firm break below the SMA5 four-hour at $1,702 to resume the bearish momentum towards the previous day’s low of $1,697.

Bears will then gear up for a test of the previous week’s low of $1,691, below which the convergence of the pivot point one-day S1 and Bollinger Band one-day Lower at $1,688 will be put at risk.

On the flip side, strong resistance is seen around $1,707, the confluence of the Fibonacci 61.8% one-week and the Fibonacci 23.6% one-day. Acceptance above the latter is needed to offer a fresh boost to XAU bulls.

The next relevant upside target is aligned at $1,710, the meeting point of the Fibonacci 38.2% one-day and SMA10 one-day. Further up, the intersection of the SMA5 one-day and the Fibonacci 38.2% one-week at $1,715 will be the level to beat for bulls.

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Gold Price Forecast: XAU/USD jumps closer to Friday’s swing high amid notable USD supply

• Gold catches fresh bids on Monday and turns positive for the second successive day.
• The prevalent USD selling bias turns out to be a key factor boosting the commodity.
• A positive risk tone, the prospects for more aggressive central banks continue to cap.

Gold attracts some dip-buying near the $1,712 area on Monday and turns positive for the second straight day. The XAU/USD refreshes its daily high, around the $1,726-$1,727 region during the European session and moves back closer to a one-and-half-week high touched on Friday.

The US dollar extends last week's sharp retracement slide and remains under intense selling pressure on the first day of a new week. In fact, the USD Index, which measures the greenback's performance against a basket of currencies, dives to a fresh monthly low and offers support to the dollar-denominated gold.

Given that the markets have already priced in a 75 bps Fed rate hike move in September, subdued action around the US Treasury bond yields turns out to be a key factor weighing on the greenback. Apart from this, growing worries about a deeper global economic downturn further contribute to driving flows towards safe-haven gold.

That said, a positive risk tone - as depicted by a generally upbeat mood around the equity markets - could act as a headwind for the precious metal. Furthermore, the prospects for a more aggressive policy tightening by major central banks warrant some caution before positioning for any further appreciating move for the non-yielding gold.

Investors might also prefer to move to the sidelines ahead of the latest US consumer inflation figures, due for release on Tuesday. The crucial US CPI report will influence the Fed's policy outlook and dictate the near-term USD trajectory. This, in turn, will help investors to determine the next leg of a directional move for gold.

In the meantime, the XAU/USD is more likely to enter a consolidation phase amid absent relevant market-moving economic data from the US. That said, the US bond yields, the USD price dynamics, along with the broader risk sentiment, might still provide some impetus to gold and allow traders to grab short-term opportunities.

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Malaysia: BNM hikes rates again – UOB

Senior Economist Julia Goh and Economist Loke Siew Ting at UOB Group review the latest interest rate decision by the BNM.

Key Takeaways

“As widely expected, Bank Negara Malaysia (BNM) raised the Overnight Policy Rate (OPR) today (8 Sep) by 25bps to 2.50%. This marks the third back-to-back rate hike since BNM started the hiking cycle in May this year as the economy recovered at a stronger pace. To date, BNM has hiked 75bps, which partly reversed the 125bps of rate cuts since the start of the pandemic in Jan 2020.”

“In the latest monetary policy statement (MPS), BNM continues to expect the domestic economy to expand, supported by private sector spending amid the transition to endemicity, positive labour market conditions, resumption of tourism activities and investments. However, BNM cautioned that external demand is expected to moderate amid softer global growth. BNM expects inflation to peak in 3Q22 before moderating thereafter amid abating base effects and easing global commodity prices.”

“BNM highlighted that there is no ‘pre-set course’ and the monetary policy committee (MPC) will continue to assess developments and their impact on domestic inflation and growth. BNM also reiterated that any adjustments will be done in a ‘measured and gradual’ manner. We think BNM may have signalled a temporary pause for rate hikes pending forward-looking growth and inflation dynamics. As such, we maintain our OPR target at 2.50% by year-end, and 3.00% by mid-2023. The next and final monetary policy meeting for the year is on 2-3 Nov.”

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Gold Price Forecast: XAU/USD bounces back to $1,700 mark, bearish potential intact

Gold slides back closer to the monthly low, though follow-through selling is limited.

Continued, relentless USD buying, aggressive Fed rate hike bets weigh on the commodity.

Recession fears, the risk-off mood offers some support to the safe-haven XAU/USD.

Gold continues losing ground through the first half of trading on Wednesday. extending the previous day's pullback from a one-week high. This, the third successive day of a negative move drags the XAU/USD further below the $1,700 mark, though it stalls just ahead of the monthly low touched last Thursday.

US dollar buying remains unabated and turns out to be a key factor exerting downward pressure on the dollar-denominated gold. In fact, the USD Index, which measures the greenback's performance against a basket of currencies, hits a fresh two-decade high amid expectations for a more aggressive policy tightening by the Fed.

The current market pricing indicates over a 70% chance that the Fed will raise interest rates by 75 bps at the upcoming meeting on September 20-21. The bets were reaffirmed by Tuesday's upbeat US ISM Services PMI, which triggered a sell-off in the US government debt market and lifted the yield on the 30-year bond to its highest level since 2014.

Moreover, the yield on the benchmark 10-year US Treasury note surged to levels not seen since June 16. This, in turn, is further offering additional support to the greenback and also contributing to driving flows away from the non-yielding gold. That said, the prevalent risk-off mood helps limit deeper losses for the safe-haven precious metal, at least for now.

The prospects for rapid interest rate hikes, along with the economic headwinds stemming from fresh COVID-19 curbs in China and the ongoing war in Ukraine, have been fueling recession fears. This continues to weigh on investors' sentiment, which is evident from a generally weaker tone around the equity markets and underpins traditional safe-haven assets.

The flight to safety assists gold to bounce back to the $1,700 round-figure mark, though any further recovery still seems elusive. In the absence of any major market-moving economic releases from the US, speeches by Fed officials will play a key role in influencing the USD price dynamics. This, in turn, could produce short-term trading opportunities around the commodity.

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GBP/USD struggles to register any meaningful recovery, hangs near two-and-half-year low

GBP/USD attracts some intraday buying on Monday, though lacks follow-through.

A modest USD pullback from a two-decade high offers some support to the major.

The fundamental/technical backdrop still seems tilted in favour of bearish traders.

The GBP/USD pair stages a modest bounce from its lowest level since March 2020, around the 1.1445 area touched earlier this Monday. Spot prices hit a fresh daily high during the mid-European session, albeit seemed to struggle to capitalize on the move or find acceptance above the 1.1500 psychological mark.

The US dollar trims a part of its early gains to a fresh two-decade high and turns out to be a key factor offering some support to the GBP/USD pair. That said, expectations that the Fed will stick to its aggressive policy tightening path act as a tailwind for the greenback. Apart from this, a bleak outlook for the UK economy continue to undermine the British pound and kept a lid on any meaningful gains for the major.

It is worth recalling that the Bank of England had warned last month that the UK economy will enter a prolonged recession during the last quarter of the year. Adding to this, the British Chambers of Commerce (BCC) downgraded its forecast and now expects the UK economy to record three consecutive quarters of contraction. This, to a larger extent, overshadows the prospects for further interest rate hikes by the UK central bank.

On the UK political front, Liz Truss won the Conservative Party leadership race to become the next British Prime Minister. The news, however, did little to impress bullish traders, suggesting that the path of least resistance for the GBP/USD pair is to the downside. That said, relatively lighter trading volumes on the back of the Labor Day holiday in the US might hold back traders from placing aggressive bearish bets and limit losses.

Nevertheless, the fundamental backdrop still supports prospects for an extension of a three-week-old downward trajectory. Even from a technical perspective, acceptance below the 1.1500 mark and the GBP/USD pair's inability to attract any buyers suggests that the near-term selling bias is still far from being over. Hence, any attempted recovery move could be seen as a selling opportunity and runs the risk of fizzling out rather quickly.

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Gold Price Forecast: XAU/USD to meltdown below the $1,675 mark – TDS

With every downtick, the risk of capitulation in gold is rising. Economists at TD Securities expect the yellow metal to slump below the $1,675 level.

China's appetite for gold has remained resilient

“The top players in Shanghai markets continue to add to their gold length, despite a depreciating CNY. These flows, alongside central bank demand, have likely kept gold from melting in a liquidity vacuum amid a hawkish Fed narrative, Nonetheless, the risk of capitulation from bloated prop-shop positioning is growing with every tick lower in prices as we approach this cohort's pandemic-era entry levels.”

“The downtrend in gold is gaining steam, as the breadth of technical signals short continues to firm.”

“The risk of a breakout in the broad dollar index could coincide with a meltdown below the $1,675 range in gold.”

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Gold Price Forecast: XAU/USD remains on the defensive amid risk-on, Fed rate-hike jitters

Gold attracts some dip-buying on Tuesday, though lacks any strong follow-through.

Retreating US bond yields undermine the USD and offer some support to the metal.

The risk-on impulse caps the upside amid expectations for aggressive Fed rate hikes.

Gold reverses a modest intraday dip to the $1,729 area and turns neutral during the first half of the European session, though it lacks any follow-through. The XAU/USD is currently seen exchnaging hands at around the $1,735 region and so far, has struggled to capitalize on the overnight bounce from over a one-month low.

The US dollar meets with a fresh supply for the second straight day and retreats further from a 20-year high touched the previous day, which, in turn, offers some support to the dollar-denominated gold. The ongoing USD profit-taking slide could be solely attributed to another decline in the US Treasury bond yields, which further benefits the non-yielding gold.

The upside, however, remains limited amid firming expectations for a supersized 75 bps Fed rate hike at the September meeting. The bets were reaffirmed by Fed Chair Jerome Powell's hawkish remarks on Friday, signalling that interest rates would be kept higher for longer to bring down inflation. This, along with the risk-on impulse, seem to cap gains for gold.

Chinese authorities pledged to stimulate the world’s second-largest economy and boosted investors' confidence. This is evident from a strong rally in the equity markets, which might hold back traders from placing bullish bets around the safe-haven precious metal. This warrants caution before confirming that gold has formed a bottom and positioning for any further gains.

Market participants look forward to the US economic docket - featuring JOLTS Job Openings data and the Conference Board's Consumer Confidence Index later during the early North American session. This, along with the US bond yields, might influence the USD. Apart from this, the risk sentiment might contribute to producing short-term trading opportunities around gold.

From a technical perspective the pair is in a medium-term downtrend that began in March 2022. This suggests the overall bias is still for lower prices to come. Major, multiple support – comprised of key lows from 2021 as well as the 200-week SMA – kicks in at $1680.00, however, and if price gets that low it will likely find a floor there and, either consolidate or bounce.

The daily chart is more complex and less bearish. Monday's dragon-fly doji candlestick is a bullish reversal insignia which will be confirmed if today (Tuesday, August 30) ends bullishly green – if not then sellers may still prevail. Confirmation would suggest at least the potential for a recovery back up to the 50-day SMA and the swing high at around $1760.00. Furthermore, markets are slow, traditionally a warning to traders not to go short. Many may have gone into wait-and-see mode till the fog clears and the market shows its hand. 

This might not happen until the closely-watched US monthly jobs report, popularly known as NFP, is released on Friday. August's employment figures will provide some insight into the economy's health in the face of rising rates and stubbornly high inflation. This, in turn, will drive the USD demand and gold prices ahead of the next FOMC meeting in September. A better-than-expected figure will suggest the economy is still booming and the Fed has more work to do to tame inflation, strengthening the dollar in the process but depressing gold. A weaker-than-expected result will have the opposite effect and probably help gold prices go higher.  

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Gold Price Forecast: XAU/USD capped by sellers aligned around $1,750

Gold price has been on the back foot, despite the generally negative market mood, currently trading at around $1,745.80 a troy ounce. The metal bottomed at the beginning of the week at $1,727.70, as the dollar outperformed other safe-haven assets throughout the first half of the week. Nevertheless, the greenback got hit by poor US data released on Tuesday, pulling down from its recent highs and correcting extreme overbought conditions against most major rivals. The bright metal peaked at $1,754.07 but so far cannot retain the $1,750 mark, with sellers quickly appearing in attempts to surpass the level. XAU/USD is seen at a critical juncture as bull-bear tug-of-war could set in, FXStreet’s Dhwani Mehta reports.

Meanwhile, financial markets are relatively quiet at the moment as investors await the US Durable Goods Orders report, expected to post a modest 0.6% advance in July. Such a tepid report will likely exacerbate concerns about a recession and weigh on high-yielding assets. The dollar will likely resume its bullish momentum after the latest pullback and is seen strengthening against its brighten rival. 

XAU/USD bears return after rejection above $1,750

“The 14-day Relative Strength Index (RSI) is turning south once again while below the midline, suggesting that the downside pressure could build up in the sessions ahead.”

“Adding credence to the bearish bias, the 50-Daily Moving Average (DMA) is fast approaching the 21 DMA from above.”

“A sustained break below the Fibonacci Retracement (Fibo) level of the recovery from yearly lows of $1,681 to the August 10 high of $1,808 at $1,729 will open up the downside towards the $1,700 mark.”

“Bulls need a daily closing above the $1,750 psychological level, above which the 38.2% Fibo resistance at $1,760 will be probed. Further up, the meeting point of the 21 and 50 DMAs at $1,769 will be a tough nut to crack for XAU bulls.”

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Gold Price Forecast: XAU/USD struggles near one-week low amid sustained USD buying

Gold witnesses selling for the second straight day on Tuesday amid modest USD strength.

Hawkish Fed expectations and elevated US bond yields continue to underpin the greenback.

Recession fears could limit losses for the safe-haven XAU/USD ahead of the FOMC minutes.

Gold attracts fresh selling near the $1,783 region on Tuesday and turns lower for the second successive day. The XAU/USD drops back closer to a one-week low touched the previous day, around the $1,774 area during the first half of the European session and now seems vulnerable to a further slide.

Following a brief consolidation through the early part of trading on Tuesday, the US dollar gains some positive traction for the third straight day and exerts some pressure on the dollar-denominated gold. Despite last week's softer US CPI report, Fed officials stressed that it is too soon to declare a victory on inflation and have maintained a hawkish tone. This, in turn, suggests that the Fed would stick to its policy tightening path and continues to underpin the greenback.

In fact, the markets are currently pricing in a greater chance of at least a 50 bps rate hike at the next FOMC policy meeting in September. This remains supportive of elevated US Treasury bond yields, which turns out to be another factor driving flows away from the non-yielding yellow metal. The downside, however, seems cushioned, at least for the time being, as investors might now prefer to move on the sidelines ahead of the FOMC meeting minutes, scheduled for release on Wednesday.

Investors would look for clues about the possibility of a larger 75 bps rate hike move in September. This could play a key role in influencing the near-term USD price dynamics and help determine the next leg of a directional move for gold. In the meantime, growing worries about a global economic downturn could lend some support to the safe-haven precious metal. Traders now look forward to the housing market data and Industrial Production figures from the US for some impetus on Tuesday.

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Gold Price Forecast: XAU/USD retreats from 50-HMA with eyes on Taiwan, US macro

Gold price fades recovery moves as traders struggle for clear directions.

China Caixin Services PMI, mixed Fedspeak favor XAU/USD buyers.

US-China tensions over Taiwan, recession woes keep sellers hopeful.

US ISM Services PMI, Factory Orders may entertain traders but risk catalysts are more important.

Gold price (XAU/USD) fails to extend daily gains around $1,770 amid the early Wednesday morning in Europe. In doing so, the yellow metal buyers struggle for fresh clues to stretch the latest recovery moves inside a trend-widening chart pattern.

Mixed concerns over Taiwan and an absence of strongly hawkish Fed comments seem to restrict immediate XAU/USD moves. Also challenging the gold price is the upbeat prints of China Caixin Services PMI for July contrasting to the official activity numbers at home and abroad, as well as broad recession woes.

US House Speaker Nancy Pelosi vows to not abandon Taiwan amid Chinese pressure, per Bloomberg, while Taiwan President shows readiness to retaliate Beijing military moves, if any. On the other hand, the private services gauge from the dragon nation rose to 55.5 versus 48 expected and 54.5 prior.

Elsewhere, St. Louis Federal Reserve President James Bullard and Cleveland Fed President Loretta Mester talked down US recession concerns while supporting chatters about the 50 basis points (bps) rate hike in September. However, San Francisco Fed President Mary Daly said that she is looking for incoming data to decide if they can downshift the rate hikes or continues at the current pace, as reported by Reuters.

Amid these plays, S&P 500 Futures rise 0.25% intraday while the US 10-year Treasury yields drop 1.5 basis points (bps) to 2.726% at the latest.

Given the market’s indecision, gold traders should wait for the US Factory Orders for June and ISM Services PMI for July. Also important will be to the headlines surrounding China, Taiwan and Fed.

Technical analysis

Gold price pares daily gains inside a one-week-old megaphone trend widening technical chart formation on the hourly play.

That said, the XAU/USD’s latest pullback from the 50-HMA, at $1,770 by the press time, lacks support from the MACD, which in turn hints at the quote’s further advances towards the previous day’s high near $1,788.

However, upper line of the aforementioned megaphone pattern, near $1,790, could challenge the bullion’s further upside.

Meanwhile, pullback moves may initial aim for the stated formation’s support line, close to $1,755, before directing gold sellers towards the 50% Fibonacci retracement of July 27 to August 02 upside, near $1,749.

Also acting as the downside filter is the 61.8% Fibonacci retracement level around $1,740.

Overall, gold price grinds higher and may witness further volatility inside the megaphone.

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Gold Price Forecast: XAUUSD surrenders intraday gains amid modest USD strength

Gold price struggles to preserve its modest intraday gains amid the emergence of some USD buying.

The prospects for a more aggressive major central banks also acted as a headwind for the metal.

The downside seems limited ahead of this week’s key US macro releases and the FOMC decision.

Gold price attracted some selling near the $1,728 region on Tuesday and retreated to the lower end of its daily range during the first half of the European session. The XAUUSD was last seen trading just below the $1,720 level, nearly unchanged for the day.

The US dollar staged a goodish rebound from the vicinity of its lowest level since July 5 touched the previous day, which, in turn, acted as a headwind for the dollar-denominated gold. This, along with the prospects for a more aggressive move by major central banks to curb soaring inflation, was seen as another factor weighing on the non-yielding yellow metal.

Gold price struggles to preserve its modest intraday gains amid the emergence of some USD buying.

The prospects for a more aggressive major central banks also acted as a headwind for the metal.

The downside seems limited ahead of this week’s key US macro releases and the FOMC decision.

Gold price attracted some selling near the $1,728 region on Tuesday and retreated to the lower end of its daily range during the first half of the European session. The XAUUSD was last seen trading just below the $1,720 level, nearly unchanged for the day.

The US dollar staged a goodish rebound from the vicinity of its lowest level since July 5 touched the previous day, which, in turn, acted as a headwind for the dollar-denominated gold. This, along with the prospects for a more aggressive move by major central banks to curb soaring inflation, was seen as another factor weighing on the non-yielding yellow metal.

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Gold Futures: Upside looks limited

Open interest in gold futures markets dropped by around 9.6K contracts on Thursday according to preliminary readings from CME Group. Volume, instead, went up for the second session in a row, this time by around 87.4K contracts.

Gold looks supported around $1,680

Thursday’s moderate rebound in prices of the ounce troy of gold was on the back of decreasing open interest, leaving the prospects for further upside somewhat diminished. On the upside, there is a strong support around the $1,680 region, where also converges the 2021 low.

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Gold Price Forecast: XAUUSD hits two-week low, near $1,815 ahead of central bank speakers

Gold remained on the defensive for the third straight day and dropped to a nearly two-week low.

Modest USD strength was seen as a key factor that undermined the dollar-denominated metal.

Recession fears, sliding US bond yields might help limit losses ahead of key central bank speakers.

Gold prolonged this week's rejection slide from the very important 200-day SMA and edged lower for the third successive day on Wednesday. The downtick dragged spot prices to a nearly two-week low, around the $1,816-$1,815 region during the early European session.

The overnight hawkish remarks by New York Fed President John Williams and San Francisco’s Mary Daly lifted bets for a faster policy tightening by the US central bank. This assisted the US dollar to build on the previous day's strong move up, which, in turn, undermined demand for the dollar-denominated gold.

Market participants, however, remain divided over the need for a more aggressive Fed rate hike amid growing recession fears. This, along with a fresh leg down in the US Treasury bond yields and the prevalent cautious market mood, could offer some support to the non-yielding yellow metal and help limit deeper losses.

Traders might also refrain from placing aggressive bets and prefer to move on the sidelines ahead of the key event risk. Fed Chair Jerome Powell, the Bank of England Governor Andrew Bailey and the European Central Bank President Christine Lagarde are due to speak at the ECB forum in Sintra, Portugal on Wednesday.

Investors will look for fresh clues about the central bank's tightening path, which will play a key role in driving gold price in the near term. Apart from this, the broader market risk sentiment, the US bond yields, and the USD price dynamics would help determine the next leg of a directional move for the XAUUSD.

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Gold Price Forecast: XAUUSD bears have the upper hand below 200-DMA amid hawkish Fed

Gold witnessed some selling on Thursday and was pressured by a combination of factors.

Hawkish Fed expectations underpinned the USD and exerted pressure on the commodity.

Recession fears weighed on investors’ sentiment and should limit losses for the XAUUSD.

Gold continued with its struggle to gain any meaningful traction and remained below the very important 200-day SMA through the early part of the European session. The XAUUSD was last seen trading just below the $1,935 level, down over 0.25% for the day.

The markets seem convinced that the Fed would retain its aggressive policy tightening path and have been pricing in another 75 bps rate hike at the next FOMC meeting in July. The bets were reaffirmed by Fed Chair Jerome Powell, saying that the ongoing rate increases will be appropriate. During his testimony before the Senate Banking Committee, Powell added that Fed is strongly committed to bringing inflation back down and the pace of future rate increases will continue to depend on incoming data. This, in turn, was seen as a key factor that continued acting as a headwind for the non-yielding gold.

Apart from this, the emergence of fresh US dollar buying exerted some downward pressure on the dollar-denominated commodity. The downside, however, seems cushioned, at least for the time being, amid the prevalent risk-off mood, which tends to benefit the safe-haven gold. The market sentiment remains fragile amid doubts that major central banks could hike interest rates to curb soaring inflation without affecting economic growth. Adding to this, the disappointing release of the flash Eurozone PMI prints for June added to worries about a possible recession and weighed on investors' sentiment.

The global flight to safety dragged the US Treasury bond yields lower, which might hold back the USD bulls from placing aggressive bets and further help limit losses for gold. That said, acceptance below a technically significant 200-day SMA favours bearish traders and suggests that the path of least resistance for spot prices is to the downside. It, however, would be prudent to wait for strong follow-through selling before traders start positioning for any further near-term depreciating move. Market participants now look forward to Fed Chair Jerome Powell's second day of testimony for a fresh trading impetus.

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