Gold price has experienced a slight setback after reaching near $2,530, staying within the familiar range above $2,500 early Wednesday. This negative action comes ahead of important events like Fedspeak, Nvidia earnings report, and US inflation data.
Gold Price Awaits Fedspeak for Fresh Impetus
The US Dollar is attempting a bounce in a risk-off environment, with Treasury bond yields remaining sluggish. Despite this, Gold price could be cushioned by dovish Fed expectations and geopolitical tensions in the Middle East.
Market sentiment remains cautious as the US believes Iran is ready to attack Israel, leading to military mobilization in the northern West Bank. These developments add to the uncertainty in the market.
Looking ahead, Fedspeak will play a crucial role in providing direction to Gold price. The market is currently pricing in a rate reduction in September, with a 32% probability of a 50 bps cut and a 68% chance of a 25 bps cut.
Gold Price Technical Analysis: Daily Chart
From a technical perspective, Gold price remains bullish as long as buyers defend the triangle support at $2,466. The 21-day SMA provides strong support at this level.
The RSI indicator shows a bullish outlook, with Gold buyers aiming to surpass the record high of $2,532 and target the $2,550 level. On the downside, support is seen at $2,500 and $2,485.
Gold FAQs
Gold has historically been a safe-haven asset, used as a store of value and hedge against inflation and currency depreciation. Central banks are major Gold holders, adding to their reserves to strengthen their economies. Gold has an inverse correlation with the US Dollar and risk assets, making it a valuable diversification tool.
Overall, Gold price movements are influenced by various factors, including geopolitical instability, economic conditions, and currency fluctuations. Understanding these factors can help investors make informed decisions about their investments.