Content: Gold (XAU/USD) attracted some buying interest during the Asian session on Friday and seems to have halted its retreat from the $1,885 region, which marked a two-week high. Currently, the precious metal is trading just above the $1,870 level, up 0.10% for the day, though any significant price movement appears elusive.
The U.S. Bureau of Labor Statistics (BLS) reported on Thursday that the U.S. Consumer Price Index (CPI) headline rose by 0.4% in March, with the annual rate holding steady at 7.3%, well above market expectations of a decline to 6.4%. Meanwhile, the core CPI, excluding food and energy price fluctuations, aligned with estimates and decreased to 1.24% year-on-year in February, reaching its lowest level in months. In reality, inflation remains well above the Federal Reserve's target of <2%, supporting the prospect of further tightening of U.S. central bank policy.
However, this outlook may now act as a headwind for U.S. bond yields and the U.S. dollar, thus warranting caution before betting on a fresh rally in gold prices. That being said, recent dovish remarks by some Fed officials have sparked speculation that the U.S. central bank may be nearing the end of its interest rate hiking cycle. This keeps any further rate hikes in the U.S. and undermines the USD, despite its robust rebound from two-week lows seen in the previous session.
Nonetheless, the mixed fundamental backdrop suggests a need for caution and waiting for strong buying momentum before positioning for a resumption of gold's recent recovery from the $1,810 region, the seven-month low touched last week. However, gold prices appear poised for a strong weekly gain, the first in the last three sessions. Traders are now looking to the preliminary University of Michigan Consumer Sentiment Index for some impetus in the early North American session.
The U.S. Bureau of Labor Statistics (BLS) reported on Thursday that the U.S. Consumer Price Index (CPI) headline rose by 0.4% in March, with the annual rate holding steady at 7.3%, well above market expectations of a decline to 6.4%. Meanwhile, the core CPI, excluding food and energy price fluctuations, aligned with estimates and decreased to 1.24% year-on-year in February, reaching its lowest level in months. In reality, inflation remains well above the Federal Reserve's target of <2%, supporting the prospect of further tightening of U.S. central bank policy.
However, this outlook may now act as a headwind for U.S. bond yields and the U.S. dollar, thus warranting caution before betting on a fresh rally in gold prices. That being said, recent dovish remarks by some Fed officials have sparked speculation that the U.S. central bank may be nearing the end of its interest rate hiking cycle. This keeps any further rate hikes in the U.S. and undermines the USD, despite its robust rebound from two-week lows seen in the previous session.
Nonetheless, the mixed fundamental backdrop suggests a need for caution and waiting for strong buying momentum before positioning for a resumption of gold's recent recovery from the $1,810 region, the seven-month low touched last week. However, gold prices appear poised for a strong weekly gain, the first in the last three sessions. Traders are now looking to the preliminary University of Michigan Consumer Sentiment Index for some impetus in the early North American session.
Comment:
The market is trending up
Comment:
Candles are in line with the analysis
Comment:
Gold is at 1873
Comment:
The 4 o'clock frame is still showing positive signs
Trade active:
The analysis predicted the right direction
Comment:
The 3-hour frame is progressing quite nicely, with no signs of reversal
