Gold has remained flat until today after a volatile day following the hot US inflation data. Gold is trading around $1,825 at the time of writing and is fluctuating at the bottom of the daily drop from Thursday’s business day. Meanwhile, forecasts for gold continue to come. cryptocoin.com We convey the details as…
US CPI at 40-year high
January Consumer Price Index data showed an annual increase of 7.5 percent. Core inflation rose 6.0 percent year-on-year after rising 0.6 percent in January. Both core and headline inflation were stronger than expected. The data added to some investors’ view that the Federal Reserve may need to act aggressively to rein in rising inflation.
As a result, major US stock indices fell sharply. The Nasdaq was down more than 2% when the US 10-Year Treasuries hit 2% for the first time since August 2019. The dollar index (DXY), which shows the dollar’s value against six major currencies, rose 0.5 percent. However, the foreign exchange markets, which formed the macro inflation outlook and started to take positions in commodity currencies, remained almost flat.
TD Securities analysts: Gold could break below $1,750
“Ultimately, we expect macro headwinds to accelerate a breakout in price,” TD Securities analysts said of their outlook for gold prices. He notes that technical analysis tools called ChartVision suggest that a break below $1,750 per ounce by July 2022 will be consistent with the continued downtrend in the yellow metal. This further supports the analysts’ view.
Meanwhile, the outlook is bearish, according to analyst Ross J. Burland. The chart above shows the price reaching $1,828, rounded down from the neckline of the W-formation. According to the analyst, this was important because this is an area of liquidity that can push supply into the market and typically limit price. This leaves the focus on the downtrend leaving $1,811 vulnerable and the bears target level is stated to be at $1,808-1,811.
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