Gold Price Analysis: XAU/USD fails to scale 50-day SMA even as US inflation expectations rise


  • Gold faces rejection above the 50-day SMA hurdle for the second day. 
  • US inflation expectations rise to highest since Q2, 2019, but fail to lift gold.

Gold, a proven store of value, struggles to gather upside traction despite the uptick in the US inflation expectations. 

The yellow metal is trading at $1,918 per ounce at press time, having faced rejection above the 50-day simple moving average (SMA) at $1,923 early Thursday. Similarly, the bulls failed to keep gains above the key SMA on Wednesday. 

The US 5-year, 5-year forward inflation swap rose to 2.20% on Wednesday, the highest level since the second quarter of 2019.  While inflation expectations are hovering well above the Federal Reserve's 2% target, the central bank is unlikely to raise rates anytime soon. 

That's because the Fed adopted average inflation targetting in August. Under the new strategy, the central bank will allow inflation to rise above 2% for some time before raising rates. Further, markets are pricing additional US fiscal stimulus. 

Even so, gold is having a tough time scaling the 50-day SMA. The latest rejection at the technical hurdle could be associated with the bounce in the dollar index, which tracks the greenback's value against major currencies. 

The dollar index is currently seen at 92.74, up 0.3% from the low of 92.47 reached Wednesday.

The S&P 500 futures are pointing to risk aversion with a 0.6% decline. As such, the haven demand for the greenback may strengthen, pushing gold lower during the day ahead.

Technical levels

XAU/USD

Overview
Today last price 1918.36
Today Daily Change -6.14
Today Daily Change % -0.32
Today daily open 1924.5
 
Trends
Daily SMA20 1898.06
Daily SMA50 1924.95
Daily SMA100 1877.32
Daily SMA200 1758.41
 
Levels
Previous Daily High 1931.54
Previous Daily Low 1906.22
Previous Weekly High 1933.3
Previous Weekly Low 1882.46
Previous Monthly High 1992.42
Previous Monthly Low 1848.82
Daily Fibonacci 38.2% 1921.87
Daily Fibonacci 61.8% 1915.89
Daily Pivot Point S1 1909.97
Daily Pivot Point S2 1895.43
Daily Pivot Point S3 1884.65
Daily Pivot Point R1 1935.29
Daily Pivot Point R2 1946.07
Daily Pivot Point R3 1960.61

 

 

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.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

USD/JPY ignores downbeat Tokyo CPI, trades mixed above 104.00

USD/JPY traders look for strong signals to break the chain of three-day declines. Tokyo CPI slipped below -0.6% forecast, core CPI matched -0.7% expected in November. Risks struggle amid US off, mixed news on vaccine, US-China front. A light calendar can extend the sideways moves.

USD/JPY News

AUD/USD: Fizzles upside momentum below 0.7400 but bears await clear signals

AUD/USD eases after refreshing the three-month top the previous day, downside have recently been confined though. Chatters surrounding US-China relations, virus woes probe risk-on but absence of the US traders, light calendar elsewhere, limits the moves.

AUD/USD News

Gold: Bears noting old support for a discount

The price of gold has broken into bearish territory below a 38.2% Fibonacci retracement. In the recent good news in markets, the price of the yellow metal has come under renewed pressure. Bears will seek a discount on a pullback to retest old support, expected to turn resistance. 

Gold news

WTI regains $45.00 even as choppy session limits the moves

WTI fades pullback moves from the highest in nine months. The energy benchmark eased from the multi-day high the previous day as global optimism, mainly fuelled through the coronavirus (COVID-19) vaccine hopes, fizzled. Also challenging the oil bulls was the US holiday due to Thanksgiving Day.

Oil News

Black Friday 2020 Discounts!

Learn to trade with the best! Don't miss the most experienced traders and speakers in FXStreet Premium webinars. Also if you are a Premium member you can get real-time FXS Signals and receive daily market analysis with the best forex insights!

More info

Forex MAJORS

Cryptocurrencies

Signatures