Gold Price Analysis: Key Factors to Consider

Gold Price Movement Before US CPI Data Release

  • Gold price defends $2,600 before the critical US CPI event risk.
  • The US Dollar retreats with Treasury yields as Trump trades-led rally stalls.
  • Gold price recovery must find a foothold above $2,645 as the daily RSI stays bearish.

Gold price has seen a slight recovery, reaching $2,600 early Wednesday, following a recent dip to its lowest level in two months at $2,590. Understanding the factors driving this movement is crucial for investors.

Factors Influencing Gold Price Recovery

Traders are adjusting their positions in response to the recent US presidential election results, which have impacted both Gold and the US Dollar. President-elect Trump’s policies are perceived as inflationary, leading to a rise in the USD and Treasury yields.

Market expectations regarding future interest rate cuts by the US Federal Reserve have also influenced trading decisions. The upcoming US CPI data release will provide further insights into the Fed’s potential actions.

Anticipated US CPI Data Impact

  • Economists predict a 2.6% rise in annual headline CPI and a 3.3% increase in core CPI for October.
  • Monthly CPI and core CPI are expected to remain stable at 0.2% and 0.3%, respectively.
  • The CPI data will influence market expectations regarding future rate cuts by the Fed.

Technical Analysis of Gold Price

On the daily chart, Gold price has shown resilience around $2,600, with buyers aiming to push it towards the 50-day SMA at $2,650. However, a downside scenario could see a retreat towards the 100-day SMA at $2,541.

It’s essential for investors to monitor key resistance levels and potential support areas based on technical analysis.

Upcoming Events and Market Impact

Investors should pay attention to Fed Chair Jerome Powell’s speech and other Fed policymakers’ statements for further insights into monetary policy decisions. These events can influence market sentiment and trading strategies.

Overall, understanding the interplay between economic data, market expectations, and technical factors is crucial for making informed investment decisions in the gold market.

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