Gold Price Forecast: XAU/USD aims to break the monthly low at $1,951.92

Valeria Bednarik FXStreet

XAU/USD Current price: $1,962.60

Risk aversion dominates financial markets and boosts the US Dollar.
FOMC Meeting Minutes could shed light on upcoming Federal Reserve monetary policy decisions.
XAU/USD trades near its May monthly low and aims to break below it.

Risk aversion weighs on financial markets, with the US Dollar making the most of it. XAU/USD is down for the day and pressuring daily lows in the $1,956 price zone, fueled by comments from United States House Speaker Kevin McCarthy. Following another round of talks with President Joe Biden on the extension of the debt ceiling, McCarthy offered a press conference in which he noted they are still apart on a number of things, remarking Republicans aim for spending cuts and no tax hikes. Finally, he added that the US would not default and that they still eventually reach a deal.

Uncertainty about the Federal Reserve (Fed) monetary policy future also undermines the mood. The Federal Open Market Committee (FOMC) will soon publish the Minutes of its latest meeting and could shed some light on the matter. Policymakers have surprised investors these last few days with hawkish comments, suggesting there’s room for one or two more rate hikes before a pause.

XAU/USD price short-term technical outlook

The daily chart for XAU/USD favors a bearish extension, as the pair trades at the lower end of its latest range, with last week’s low at $1,951.92 providing immediate support. In the mentioned time frame, the pair extends its decline below a mildly bearish 20 Simple Moving Average (SMA) while the longer moving averages maintain their upward strength far below the current level. At the same time, the Momentum indicator heads firmly south well into negative levels, while the Relative Strength Index (RSI) indicator resumed its decline and currently stands at around 41.

In the near term, and according to the 4-hour chart, the risk also skews to the downside. The pair develops below all its moving averages, with a flat 20 SMA providing dynamic resistance at around $1,972. At the same time, technical indicators head firmly lower within negative levels, still above oversold readings.

Support levels: 1,951.90 1,944.00 1,931.60

Resistance levels: 1,972.00 1,984.20 1,996.80

View Live Chart for XAU/USD

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to Premium Sign In

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD sticks to positive bias above 1.1800 as trade jitters undermine USD

The EUR/USD pair builds on the previous day's modest gains and attracts some buyers for the second straight day on Thursday amid a softer US Dollar. Spot prices, however, lack bullish conviction and trade around the 1.1815-1.1820 area during the Asian session, up 0.10% for the day.

GBP/USD bounces as soft CPI boosts BoE cut bets

GBP/USD rose 0.42% on Wednesday, recovering toward 1.3600 in a session shaped by softer-than-expected UK inflation data and broad US Dollar weakness. The pair had been consolidating in a tight range between about 1.3450 and 1.3520 for the past few days following the sharp pullback from the late-January high near 1.3870, and Wednesday's move pushed price action back onto the high side of key moving averages.

Gold retains positive bias amid sustained safe-haven demand, softer USD

Gold attracts some buyers for the second straight day as trade jitters and geopolitical tensions ahead of the US-Iran nuclear talks underpin demand for safe-haven assets. Apart from this, a softer US Dollar further supports the bullion, though the underlying bullish sentiment could cap gains. Bulls might also opt to wait for acceptance above the $5,200 mark before positioning for any meaningful appreciating move.

UK financial watchdog advances stablecoin oversight as four firms pilot issuance

The Financial Conduct Authority in the United Kingdom is advancing toward the final stablecoin regulatory framework with a pilot program involving four companies, including Monee, Financial Technologies ReStabilise, Revolut and VVTX.

Nvidia delivers another monster earnings report, and forecasts big things to come

It was another monster earnings report from Nvidia for fiscal Q4. Revenues were $68.1bn, smashing estimates of $65bn. Gross profit margin was a healthy 75%, up from 73.5% in the prior quarter, and the outlook for this quarter was monstrous.

Cosmos Hub Price Forecast: ATOM rebounds slightly, bearish outlook remains intact

Cosmos Hub (ATOM) price rebounds, trading above $2.05 at the time of writing on Wednesday, after undergoing a sharp correction since last week. Weakening on-chain and derivatives data support a bearish outlook, while technical analysis remains unfavorable.