- Gold price hits $2,432 before stabilizing below $2,400 due to US Treasury yields pressure.
- FedWatch Tool predicts 100% chance of rate cut in September, boosting gold prices.
- India reduces import tax on precious metals, driving demand; key US economic data awaited.
As the gold price remains steady below $2,400, recent market trends indicate a struggle to maintain momentum above this key level. Pressure from rising US Treasury bond yields and a risk-averse environment have contributed to the metal’s inability to sustain higher prices.
Traders have shown interest in gold as US Treasury yields dipped temporarily before bouncing back, with the 10-year yield reaching 4.274%. The US Dollar Index has also experienced some downward movement but remains relatively stable at 104.38.
The looming possibility of a rate cut by the Federal Reserve in September has provided support for gold prices, with market expectations aligning with a 100% chance of a 25-bps reduction. Additionally, India’s decision to slash import taxes on precious metals has further fueled demand for gold.
Upcoming US economic data releases, including GDP figures for Q2 and the Personal Consumption Expenditure Price Index, are expected to provide further insight into the market’s direction.
Market Analysis: What to Expect in the Coming Days
- Services and Composite PMIs for July exceeded estimates, showing positive growth.
- Manufacturing PMI fell below expectations, indicating a slight slowdown in the sector.
- US Goods Trade Balance for June improved compared to previous months.
- GDP for Q2 is projected to show increased economic activity.
- Core PCE inflation is expected to dip slightly.
Technical Outlook: Gold Price Trends and Potential Trading Opportunities
Gold prices have shown resilience but face resistance below $2,430. A break above this level could lead to further gains towards $2,450 and beyond. On the downside, a drop below $2,384 could signal a deeper correction towards key support levels.
Traders should monitor the Relative Strength Index (RSI) for signals of buyer and seller strength. Key resistance levels to watch include $2,430, $2,450, and the all-time high of $2,483. Support levels include $2,384, the 50-day SMA at $2,359, and the 100-day SMA at $2,315.
Overall, market sentiment remains optimistic for gold, with key economic data and global events shaping future price movements.
For more insights on inflation and its impact on the gold market, check out the Inflation FAQs section below.