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MARKET ANALYSIS AND COMMENTARY - WEEK 50 - 2023 (December 11 - December 15] This week, international gold prices soared to 2,144$ in the first session of the week, but then gradually decreased to 1,994$ and closed the week at 2.004$
International gold prices increased sharply earlier this week because the market expected the FED to cut interest rates for the first time in March 2024 after a long series of sharp increases in interest rates to 5.25-5.5%. However, this upward momentum was interrupted just one day later.
At the weekend session, US November employment data seemed to pour cold water on gold prices. Specifically, according to the US Bureau of Labor Statistics, the number of US non-farm jobs (NFP) increased by 199,000 jobs in November, higher than market estimates of 184,000 jobs. At the same time, the report also said that the US unemployment rate decreased to 3.7%, from 3.9% in October. NFP data has made market expectations about the FED cutting interest rates in March decreased from about 60% to about 43%.
Next week, the US will announce the consumer price index (CPI) and producer price index (PPI), in which the market pays special attention to CPI. As expected, November CPI will increase by 3.1%, down slightly from the previous period of 3.2%. If this index remains above 3%, it is likely that at next week's meeting the FED will still express a hawkish attitude about tightening monetary policy. This will have a negative impact on gold prices next week. On the contrary, if CPI falls below 3%, the FED will likely cut interest rates early next year. This of course continues to push gold prices higher next week.
Technically, observing the ptkt chart in frame D1, the gold price had an increase from the 1934$ threshold to close to the 2144 threshold, approximately 210 gold prices, but then dropped nearly 150 prices, this adjustment phase was quite good. nearly 60% deep, showing that selling pressure is dominating. Next week, if gold prices trade below 2,000$, it is likely that this downward momentum will maintain to 1,935$.
If trading above the threshold of 2,000$, the gold price may find the range of 2,050-70$ again.
The trading plan for next week will consider selling around 2050$, buying around 1935$, accepting a stop loss of 5 prices for each strategy.
