- Gold price holds in bullish territory.
- Gold could set to test recent highs near $2,000.
The Gold price ended Friday lower by some 0.5%, dropping from a high of $1,987.50 and hitting a low of $1,966.81 despite Friday’s economic news that showed the US Feb core PCE deflator, the Federal Reserve’s preferred inflation gauge, rose less than expected.
The data was raising hopes that Fed rate hikes may be close to ending. However, metals prices Friday fell back from their best levels, with the Gold price falling into negative territory after the US Dollar rallied on month and quarter-end flows.
Gold prices have gained for two consecutive quarters, posting the largest cumulative percentage gain since the six-month period ended September 2020 and with investors continuing to worry that the recent bank industry crisis will reduce lending in the US, and interest rate sensitive sectors are set to experience a difficult period, investors decided that gold is unlikely to drop lower, analysts at TD Securities explained.
´´As such, money managers aggressively covered their short exposure. As rates fell and the US dollar weakened, specs used the yellow metal to protect purchasing power by taking on new large long positions,´´ the analysts said.
´´Gold is set to test recent highs near $2,000 amid lower-than-expected PCE inflation and possible new economic weakness. However, the market looks to the March payrolls to decide if next week is the time to take gold to recent highs.´´
Gold weekly chart
The Weekly chart´s W-formation has seen the Gold price duck towards the neckline. There could be some more to go but there has already been a 38.2% Fibonacci correction.
Gold daily chart
We have a bullish pennant on the daily and 4-hour charts:
Gold H4 chart
Gold H1 chart
On the lower timeframe, the supporting trendline is being pressured but so long as the majority of the trend remains intact, the bullish pennant will remain valid.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
AUD/USD weakens below 0.6400 ahead of Australian employment data
The AUD/USD pair remains on the defensive near 0.6370 after bouncing off a fresh year-to-date low of 0.6336. The dovish stance by the Reserve Bank of Australia drags the Australian Dollar lower. Traders will closely monitor the Australian November labor market data, along with the US PPI data, which are due later on Thursday.
EUR/USD drops below 1.0500 after US inflation data
EUR/USD stays under pressure and trades below 1.0500 in the American session on Wednesday. The US Dollar stays resilient against its rivals after the data showed that the annual CPI inflation edged higher to 2.7% in November, not allowing the pair to stage a rebound.
Gold skyrockets as US inflation suggests Fed easing ahead
Gold prices prolonged their uptrend on Wednesday following the release of inflation figures in the United States. Expectations that the Federal Reserve would cut interest rates next week were reaffirmed as the disinflation process evolves, yet at a slower pace.
Ethereum eyes new yearly high as whale and institutional holdings increase
Ethereum is up 6% on Wednesday after bouncing off the support level near $3,550. The spot market shows institutional investors and whales maintained a bullish sentiment, potentially scooping up ETH at lower prices during the recent dip.
BTC faces setback from Microsoft’s rejection
Bitcoin price hovers around $98,400 on Wednesday after declining 4.47% since Monday. Microsoft shareholders rejected the proposal to add Bitcoin to the company’s balance sheet on Tuesday.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.