XAU/USD Current price: $2,576.61
- Mixed United States data and Fed speakers helped US Dollar correct overbought conditions.
- Central bank’s leaders will be on the wires during the American afternoon.
- XAU/USD in a corrective advance that may continue in the near term.
Spot Gold trades around $2,575 a troy ounce, recovering from a fresh multi-week low of $2,536.68 posted during European trading hours. The US Dollar maintained its positive momentum until Wall Street’s opening, reaching once again fresh highs across the FX board.
United States (US) data came in mixed, as the country reported that Initial Jobless Claims shrank to 217K in the week ended November 8, better than the 223K anticipated. However, the October Producer Price Index (PPI) rose by more than expected, reviving inflation-related concerns. Wholesale inflation was up by 0.2% in the month and 2.4% from a year earlier. The core annual reading printed at 3.1%, above the 3% forecast and the previous 2.9%. The latter was upwardly revised from a previous estimate of 2.8%.
Meanwhile, different Federal Reserve (Fed) officials have been on the wires. So far, comments have added nothing new to what the market already knew about monetary policy. Later in the day, the focus will be on Chairman Jerome Powell, due to participate in a panel discussion titled "Global Perspectives" at an event hosted by the Federal Reserve Bank of Dallas. Comments on monetary policy may be limited, but questions about how the upcoming Donald Trump government will affect the central bank’s decision will be at the top of the list.
European Central Bank (ECB) President Christine Lagarde and Bank of England (BoE) Governor Andrew Bailey are also expected to share their thoughts.
XAU/USD short-term technical outlook
The daily chart for XAU/USD shows that it bounced from a bullish 100 Simple Moving Average (SMA) and that the pair develops far below a bearish 20 SMA. At the same time, technical indicators keep heading south near oversold readings, albeit losing their downward strength.
In the near term, and according to the 4-hour chart, the ongoing upward correction seems poised to continue. Technical indicators aim sharply north, albeit still below their midlines. At the same time, the 20 SMA heads firmly lower, currently providing dynamic resistance at around $2,594.20. Finally, the 100 SMA gains downward traction above the 200 SMA, approaching the longer one, usually hinting at a long-lasting bearish trend.
Support levels: 2,548.70 2,536.60 2,522.40
Resistance levels: 2,581.35 2,594.20 2,611.05
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