Gold approaches key triangle apex ahead of FOMC Minutes

Gold prices fluctuate within the apex of the triangle as traders await crucial US economic data and Federal Reserve updates, reflecting a cautious market stance.
Recent dovish comments from Fed Chairman Jerome Powell and declining US Treasury bond yields have supported gold prices.
From a technical perspective, the gold market remains range-bound and waits for major catalysts to break the current consolidation.

Muhammad Umair, PhD Gold Predictors

Gold prices fluctuate in ranges, reflecting a cautious market stance ahead of crucial US economic data and Fed updates. Traders are eyeing the upcoming US ADP Employment Change report and the Minutes from the Fed's June policy meeting for further direction. The US Treasury bond yields have slightly declined following Powell's comments, supporting gold prices. The latest World Gold Council report also highlighted significant gold purchases by central banks, including the National Bank of Poland, indicating continued demand for the precious metal. Market participants are also considering the weaker-than-expected China Caixin Services PMI, which has rekindled concerns about global economic growth. As markets now see a higher probability of a Fed rate cut in September, these developments collectively influence gold prices, making the upcoming economic indicators pivotal for future price movements.

Gold approaches near the apex of triangle

From the technical perspective, gold prices are fluctuating, but Monday's consolidation has kept them stable within the apex of the triangle, as shown in the chart below. However, prices are struggling to take a clear direction. Last week's rebound and Monday's consolidation have produced an inverted head and shoulders pattern on a short-term basis, indicating a potential price move toward the $2,350 level. Nevertheless, the overall market remains sideways, and prices are expected to fluctuate within a broad range until a significant announcement or major catalyst breaks the current pattern. With June now ended, markets are anticipated to mark a bottom for the next move higher, so a price drop before the next upward move is not out of the question.

Bottom line

In conclusion, gold prices fluctuate within the apex of the triangle as the market adopts a cautious stance ahead of critical US economic data and Federal Reserve updates. Traders are closely monitoring the US ADP Employment Change report and the Fed's June policy meeting minutes for further direction. Recent dovish comments from Fed Chairman Jerome Powell and declining US Treasury bond yields have provided some support for gold, while significant central bank purchases, notably by the National Bank of Poland, underscore ongoing demand for the metal. Despite short-term technical patterns suggesting a potential rise towards $2,350, the market remains range-bound, awaiting a major catalyst to break the current consolidation. As the seasonal correction period for gold ends in the June/July, a potential bottom formation is expected soon, which may lead to higher prices for the remainder of the year.

Unlock exclusive gold and silver trading signals and updates that most investors don’t see. Join our free newsletter now!

Author

Muhammad Umair, PhD

Gold Predictors

Muhammad Umair is a financial markets analyst and investor who focuses on the forex and precious metals markets.

EUR/USD onsolidates around mid-1.1800s as traders keenly await FOMC Minutes

The EUR/USD pair struggles to capitalize on the previous day's goodish rebound from the 1.1800 neighborhood, or a one-and-a-half-week low, and consolidates in a narrow band during the Asian session on Wednesday. Spot prices currently trade just below mid-1.1800s, nearly unchanged for the day.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold bounces back toward $4,900, looks to FOMC Minutes

Gold is attempting a bounce from the $4,850 level, having touched a one-week low on Tuesday. Signs of progress in US–Iran talks dented demand for the traditional safe-haven bullion, weighing on Gold in early trades. However, rising bets for more Fed rate cuts keep the US Dollar bulls on the defensive and act as a tailwind for the non-yielding yellow metal. Traders now seem reluctant ahead of the FOMC Minutes, which would offer cues about the Fed's rate-cut path and provide some meaningful impetus.

DeFi could lift crypto market from current bear phase: Bitwise

Bitwise Chief Investment Officer Matt Hougan hinted that the decentralized finance sector could lead the crypto market out of the current bear phase, citing Aave Labs’ latest community proposal as a potential signal of good things to come.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.