Gold futures were trading sideways early Monday with gains capped by the strong US dollar. Meanwhile, U.S. Treasury yields remained flat as investors cautiously await the Fed’s cuts and key interest rate decisions after data showed another rise in inflation. So, what levels are next? cryptocoin.com We review as…
Fed statements for gold price are followed closely
Gold price opened Monday around $1,785. According to analyst James Hyerczyk, today’s early price action follows Friday’s steep sell-off fueled by another spike in inflation, with the personal consumption price index (PCE) rising last month. According to the analyst, long positions lowered their gold positions on this news because they thought this could push the Fed to raise interest rates sooner than expected. The 4.4 percent increase in the government’s core personal consumption expenditures index—the Fed’s preferred measure of inflation—firmed market expectations for a rate hike by mid-2022.
Following the data’s release, Fed Funds futures, tracking short-term rate expectations, priced in a 90 percent chance of a quarter-point tightening through June 2022, accounting for another rate hike through December.
What does the daily chart show?
The main trend is up, but momentum is trending lower, according to the daily swing chart. A trade of $1,815.50 reaffirms the uptrend, while a move towards $1,760.30 will change the major trend downwards. On the other hand, the analyst, who said that the minor trend points to the downside, said that on Friday, gold went down, shifting the momentum to the downside.
Gold is currently trading at a series of pullback levels, which could affect the short-term direction of the market, according to Hyerczyk. On the upside, potential resistance is listed at $1,787.90, $1,795.00, and $1,800.00. Hyerczyk points out that $1,795 is a potential trigger point for an upward acceleration. On the downside, initial support is shown at $1780.50, followed by $1768.30 and $1757.40. Again, the latter is a potential trigger point for a drop to $1,738.60. The current pullback configuration suggests the path of least resistance is down.
What is the daily forecast?
According to the analyst, the direction of the December Comex gold market on Monday will be determined by the reaction of traders to $ 1780.50. Looking at the analyst’s bullish scenario, a sustained move above $1,780.50 will indicate the presence of buyers. The first upside target is $1,787.90. Overcoming this level could provide a test of the $1,795.00 and $1,800.00 levels. Looking at the analyst’s bear scenario, a sustained move below $178.50 could lead to a test of $1768.30.
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