The below is the weekly chart of the XAUUSD. The precious metal has charted a lower peak (LP) followed by a lower trough (LT). This is the classical definition of a downtrend. However, the volatility of gold has narrowed over the last 2 weeks (green rectangle) and the RSI remains on the bullish side of 50 (blue rectnagle). Given the poor data out of the US including PMI prints, low wage growth, inflation below target and disappointing retail numbers it is likely that the Fed is looking at another 25bps cut this month and possibility another 25bnps in December. If this is the case, then XAUUSD is likely to find support at or near current levels. We continue to monitor.
Past performance is not an indicator of future results.
CHART SOURCE: FXCM MARKETSCOPE 2.0