XAU/USD Analysis: Current Price at $2,639.49
- United States Markets Closed for Thanksgiving Holiday
- Expectations of Federal Reserve Interest Rate Cut in December
- XAU/USD Facing Downward Pressure, Potential Break Below $2,600
Spot Gold is trading below $2,650 amidst a subdued market environment due to the Thanksgiving Holiday in the United States. Recent US macroeconomic data release has kept the market quiet as all American markets are closed for the holiday.
Investors are anticipating a potential interest rate cut by the Federal Reserve in mid-December, with current odds standing at around 70% according to the CME FedWatch Tool. This expectation is providing support to the price of Gold in the near term.
European stocks closed higher, particularly led by the tech sector, as concerns over US imposing new tariffs on Chinese products eased.
XAU/USD Short-Term Technical Outlook
Looking at the technical analysis, XAU/USD has shown limited upward movement and is currently trading near the lower end of its weekly range. The daily chart indicates a downside risk, with Gold facing resistance at the bearish 20 Simple Moving Average (SMA). The 100 and 200 SMAs are below the current price level, losing their upward momentum. Additionally, technical indicators show a lack of buying interest.
On the 4-hour chart, XAU/USD is in a neutral-to-bearish position, trading above the 20 and 100 SMAs. The shorter SMA has a downward slope, indicating increasing selling pressure. Technical indicators suggest a potential further decline as they are showing a bearish signal.
Support Levels: 2,626.70, 2,611.35, 2,598.70
Resistance Levels: 2,643.30, 2,655.00, 2,671.55
Analysis Summary
The current market conditions for XAU/USD are influenced by the Thanksgiving Holiday in the US, leading to subdued trading activity. However, investor expectations of a Federal Reserve interest rate cut in December are providing support to the price of Gold in the near term.
From a technical standpoint, XAU/USD is facing downward pressure, with the potential to break below the $2,600 level. Resistance is observed at the bearish 20 SMA on the daily chart, indicating a downside risk. The 4-hour chart shows a neutral-to-bearish outlook, with technical indicators pointing towards further selling pressure.
For traders and investors, it is essential to monitor key support and resistance levels to gauge potential price movements. The upcoming Fed meeting in December will be a crucial event to watch, as any decision on interest rates could significantly impact the price of Gold.