Gold (XAU/USD) experienced a slight correction after reaching a new all-time high this week but managed to climb back above the crucial $2,500 level on Friday. The technical analysis indicates that the bullish trend for XAU/USD is still intact in the short term, with investors eagerly anticipating the upcoming US inflation data.
Gold Sets Another Record High
Gold started the week on a positive note, entering a consolidation phase on Monday before closing the day unchanged. Dovish statements from Federal Reserve (Fed) officials led to a decrease in US Treasury bond yields on Tuesday, allowing XAU/USD to reach a new record high of $2,531.
Remarks from Fed Governor Michelle Bowman and Minneapolis Fed President Neel Kashkari hinted at a possible rate cut in the near future, adding to the bullish sentiment for Gold. Despite some midweek struggles, XAU/USD held above $2,500 as the US Dollar faced selling pressure.
Positive data on business activity from S&P Global on Thursday initially boosted the USD, causing XAU/USD to dip below $2,500. However, a recovery in Gold prices was seen on Friday as Fed Chairman Jerome Powell’s speech weighed on the USD, pushing XAU/USD back above $2,500.
Gold Investors Await US Inflation Data
Next week’s economic calendar will include key data releases, such as Durable Goods Orders and the Gross Domestic Product (GDP) growth estimate for the second quarter. Investors will closely monitor the Personal Consumption Expenditures (PCE) Price Index data, the Fed’s preferred inflation gauge, on Friday.
The technical outlook for Gold suggests that the bullish trend remains intact, with the Relative Strength Index (RSI) pointing towards further upside potential. Key levels to watch include $2,500 as immediate support and $2,600 as the next resistance level.
Overall, the outlook for Gold remains positive, with potential market reactions to US economic data likely to impact XAU/USD’s price movements in the coming week.