FX:XAUUSD is in the bull run phase. The price growth is fueled not only by the breakout of consolidation, bullish trend, but also by the huge interest on the background of negative geopolitics, high inflation, but also by the fundamentally weakening dollar.
The price is forming strong consolidations with subsequent growth without correction phases, which tells us that there is either a strong buyer or no seller, which is more likely. For the market, psychological levels may be the targets. Such as 2175, 2200. The scenario with a false breakdown of the past ATH failed due to fundamental factors. So at the moment we need to consider a test of the above mentioned important levels. There is news ahead which is important but at the same time unpredictable. Be careful. Price entry into the risk zones will trigger a strong sell-off phase.
Resistance levels: 2175, 2185, 2200. Support levels: 2161, 2145, 2100
It is hard to expect anything amid strong growth and approaching NFP. The market may be very aggressive and give high volatility and volume. Within this framework, the price can quite confidently test both 2200 and 2100 (buyer liquidation phase)
I have indicated several directions on the chart and it may confuse you. I understand.
But, the trend is strong now. The priority of course is to consider the growth to 2175 - 2200, but any slightest reason can provoke strong sell-offs.
The risk zones are below these support lines. Price entry into the zones below these lines will activate stoporders and sellers' orders, which will start the phase of buyers' liquidation.
Comment
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On Wednesday and Thursday, Powell signaled a bit that an interest rate cut is possible, but only if inflation reaches the 2% level. Right now that level is still high. Basically, nothing has changed in his rhetoric recently. But based on the data, inflation has gotten a little bit worse.
Yesterday we got Initial Jobless Claims at 217K, which is neutral. The dollar continues to reign in the neutral-negative fundamental backdrop.
Today all eyes are on NonFarm Payrolls. In the last period it was received extremely unexpected data of 353K. Today analysts are expecting 198K. Obviously, 353K is a painted figure, the data is back to its target. Based on the Wednesday-Thursday information, the market is neutral-negative. Our expectation for NFP is 198K - 187K, which will continue to support the overall fundamental backdrop and the dollar will continue to decline slightly towards support.
Higher than expected data will strengthen the dollar Conversely, lower than expected data will weaken the dollar.
Just a reminder. These are just analytical assumptions. News is unpredictable. Trade safe!
Powell didn't say anything good for the dollar. Neutral position. Initial Jobless Claims was neutral yesterday The general trend of the last two weeks is also bearish.
Qadri0709
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@RLinda, if we see the trend NFP always disappointed the expectations and most of the time it appears bullish for the dollar.
Hi Rlinda,, what do i expect from NFP ? millions dollar question.. overall Market structure bullish, there is no resistance because market is in unknown territory, but again NFP have always been surprise. it seems likely that month nfp will be higher then consensus because the figures have consistently beaten expectation since May last year. my range today 2032-40 -75.. By the way analyzing on your daily idea (fundamental) excellent..
RLinda
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@princesaif85, ha ha. Exactly, the million dollar question)))))) Maybe, but it seems that way to me:
Powell maintained a neutral stance (This is not a direct impact on today's news, but it is a consequence of the overall policy). Initial jobless claims came out neutral yesterday and this is the most direct precondition for a possible NFP The general trend of the last two weeks is also bearish (I mean economic leverage in general).
princesaif85
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@RLinda, I have concentrated on the Fed's extended hawkishness recently: there's a very low chance now of a cut to the funds rate before June. its mean a market will trun down till 2000.
NFP is coming up, what do you expect from this news?
Where will gold go in your opinion?