FUNDAMENTAL OVERVIEW
Gold got stuck in a consolidation after the selloff experienced at the beginning of the week. We saw mixed and confusing moves across different markets with crude oil being the only one making sense. The focus is of course on the US-Iran war and especially on the Strait of Hormuz, which remains virtually closed.
This conflict is pushing energy prices higher, which is feeding into rising inflation expectations. That triggered a hawkish repricing in interest rates expectations, which might have weighed on gold.
Today, we have the US NFP report, and although the data might not matter much right now, it might trigger another hawkish repricing if we get strong data and weigh on the market.
GOLD TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can see that gold is consolidating around the 5,100 level with traders awaiting new catalysts for the next direction. There’s not much we can glean from this timeframe, so we need to zoom in to see some more details.
GOLD TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we can see the price probed below the key support zone around the 5,100 level again yesterday but failed to sustain the breakout. This consolidation is leading to many false moves. The sellers will want to wait for the price to break below the weekly low around the 4,995 level before piling in with more conviction to target the 4,600 level next. The buyers, on the other hand, will look for a break above the 5,200 level to open the door for a rally into the all-time high.
GOLD TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, we can see that we have a downward trendline defining the recent pullback into the 5,100 support. We can expect the sellers to lean on the trendline with a defined risk above it to keep pushing into new lows. The buyers, on the other hand, will look for a break to pile in for a rally into the all-time highs. The red lines define the average daily range for today.
UPCOMING CATALYSTS
Today we conclude the week with the US NFP report but continue to keep an eye on US-Iran headlines as that’s what the market is focused on.
