Special Gold pre-CPI update

OANDA:XAUUSD   Gold Spot / U.S. Dollar
Goodday traders,

Big day today again in the market with US CPI eyed and the FOMC minutes later in the day. A little breakdown of some scenarios so we are prepared:

🔷 Scenario 1: CPI higher than forecast (>4%)
Dollar will break the 94.5 weekly resistance and most likely will settle the week with more bullishness to expect in the coming weeks. Expect a breakout towards 95 and 96 in extension. Gold towards 1720.

🔷 Scenario 2: CPI as forecast (between 3,9 & 4,1%)
Already priced in and most likely will remain in the range 94-94.5. Traders will look further to the FOMC minutes for the next direction. Gold remains rangebound between 1780-1750 until the next fundamental trigger.

🔷 Scenario 3: CPI lower than forecast (<4%)
This is a bearish scenario and will complicate the outlook for the taper announcement in November after 2 NFP misses and the JOLTS miss yesterday. The dollar will most likely test the next support which is around 92.5 & 93 in the coming days. Gold most likely to test the 1800 resistance.

FOMC Minutes
The other fundamental trigger will be the FOMC minutes. Traders and investors will be looking for more details on when the FED wants to taper and when they need to postpone the tapering. If these treshholds have missed (NFP & CPI ), then it's pretty sure for traders that FED will postpone the taper announcement to December.

For now, it seems the dollar is rolling over to the downside as expected from the 94.5 weekly resistance. This can be early profit taking before the datarelease, or the big boys already have some data leakage that CPI will miss its forecast and started selling early.

🔮 I remain bullish on gold and I expect to test 1800 this week. Let's not forget the inverse H&S on the daily chart which is pointing at 1808 with 1830 in extension.
Trade closed manually: All buys closed before FOMC. 1795 is good enough. :)