Gold has breached the recent high at 2010 in the APAC session as the bullish sentiment continues to prevail amid rate cuts expectations and weakening US data. Such expectations led to lower real yields and weaker US Dollar which are in favour of higher Gold prices. The Fed is now done with the tightening cycle and the data is likely to deteriorate further, so on a forward-looking basis Gold should remain supported with the all-time high at 2078 being the natural target.
Gold Technical Analysis – Daily Timeframe
On the daily chart, we can see that Gold probed above the recent high at 2010 today as the bullish bias continues to be supported by rate cuts expectations amid weakening US data. The target for the buyers should be the all-time high zone around the 2076 level. The sellers, on the other hand, will need some key downside breakouts to pile in as there’s no resistance until the all-time high.
Gold Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the buyers continue to lean on the trendline and the red 21 moving average to keep positioning for the all-time high. The spike higher today diverged with the MACD which is generally a sign of weakening momentum often followed by pullbacks or reversals. In this case, the buyers would be better off waiting for a pullback into the trendline where they will have a better risk to reward setup. The sellers, on the other hand, will want to see the price breaking lower to pile in and target a break below the 1985 support.
Gold Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the current price action around the recent high. We can expect some aggressive buyers piling in already at this zone with a defined risk below it to target another extension to the upside, but the risk to reward would be much worse. Conversely, some aggressive sellers might want to pile in as soon as the price falls below this zone to target a pullback into the trendline.
Upcoming Events
Tomorrow, we have the US Consumer Confidence report. On Thursday, we will see the latest US Jobless Claims figures and the US PCE report. On Friday, we conclude the week with the US ISM Manufacturing PMI which missed expectations by a big margin the last time. Weak data is likely to give a boost to Gold while strong figures should lead to pullbacks.
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