XAU/USD Price Analysis: Gold Battles to Hold $2,500 Level Amid Market Uncertainty
- Wall Street Turns Red as Investors Anticipate NVIDIA Earnings Report
- Market Awaits United States Inflation Update
- XAU/USD Struggles to Maintain $2,500 Level Ahead of Key Market Announcements
Spot Gold dipped to $2,493.46 on Wednesday, continuing its downward trend in the American session. Despite trading in the red for the day, the US Dollar saw some strength after being oversold against major currencies. The US Dollar Index (DXY) hit a year-to-date low of 100.52 before finding support.
XAU/USD is currently driven by market sentiment, with focus on upcoming inflation data in the US. The release of the July Personal Consumption Expenditures (PCE) Price Index next Friday will be closely watched as it is the Federal Reserve’s preferred inflation measure. Investors are also cautious ahead of NVIDIA’s earnings report, expected after market close. Any surprises in the AI company’s revenue growth could lead to significant market movements, especially during the Asian trading session.
While Wall Street is in the red, bond yields remain stable near August lows, with the 10-year Treasury note offering 3.83% at present.
XAU/USD Technical Analysis
Technically, the XAU/USD pair shows signs of further downside potential. Despite ending a three-day winning streak, the precious metal maintains modest weekly gains. Daily chart indicators suggest a possible corrective decline, with the 20 Simple Moving Average (SMA) acting as a bearish target around $2,467.00. The long-term bullish trend remains intact, supported by the upward sloping longer moving averages.
In the 4-hour chart, XAU/USD struggles to hold above $2,500 and faces downward pressure. The Momentum indicator points downwards within negative levels, while the Relative Strength Index (RSI) hovers around 43, indicating further downside potential.
Support Levels: $2,508.80, $2,496.40, $2,485.10
Resistance Levels: $2,523.50, $2,531.60, $2,542.00