GOLD - A Hunt for Liquidity Ahead of Further Declines

Sep 9

XAUUSD has been forming a countertrend correction since the session opened. The fundamental backdrop remains unstable, and this correction could end with another move lower

Gold remains exposed to two-sided risks ahead of the release of U.S. CPI data. The sell-the-bounce strategy remains in place, especially against the backdrop of higher-than-expected inflation in China. TD Securities expects core inflation to remain under control in August but warns of upside risks
Drivers:
Upside: weak U.S. CPI data, dollar weakness, de-escalation of the conflict.
Downside: hot CPI data, dollar strength, escalation of the conflict, hawkish Fed rhetoric

Resistance levels: 4,410, 4,435, 4,461
Support levels: 4,365, 4,287

A weaker dollar, driven by yen strength, is supporting gold. At the same time, however, gold remains under pressure from the Fed’s hawkish stance and geopolitical risks.
Technically, I expect a short squeeze around the 4,430–4,435 liquidity zone, followed by a decline toward range support at 4,365–4,287

Best regards,
R. Linda!

Sep 9

Trade active

Sep 10

Trade closed: target reached