Gold Price Forecast: XAU/USD struggles to find direction as focus shifts to Fed policy

Gold price is inside the woods as investors are awaiting the Fed policy announcement for further guidance.
The USD Index slipped firmly from 102.17 despite the upbeat Employment Cost Index and consistency in consumer spending.
Lengthy consolidation in the Gold price would be followed by wider ticks and heavy volume after an explosion

Sagar Dua FXStreet

Gold price (XAU/USD) is hovering around $1,990.00 in the early Asian session. The precious metal is struggling to find any direction as investors are awaiting the announcement of the interest rate decision by the Federal Reserve (Fed). The yellow metal is bounded in a range of $1,970-2,010 from the past week as investors are anxious about knowing the importance of May’s monetary policy meeting.

S&P500 settled last week with 1% gains despite a sell-off in the initial days. After digesting renewed fears of United States banking woes investors shifted their focus on upbeat quarterly earnings from technology stocks. Also, Friday’s bullish closing portrays an upbeat market mood.

The US Dollar Index (DXY) slipped firmly from the weekly high of 102.17 on Friday despite an upbeat Employment Cost Index and consistency in consumer spending. The Labor Cost Index (Q1) jumped to 1.2% from the consensus and the former release of 1.1%. A higher labor cost index indicates that firms still offer higher wages to attract talent due to labor shortage.

Meanwhile, the monthly core Personal Consumption Expenditure (PCE) Price Index remained consistent with estimates and former acceleration at 0.3%. The preferred tool of the Fed to judge the overall context of inflationary pressures in the US economy landed at 4.6% higher than expectations of 4.5% but lower than the former release of 4.7% on an annual basis, indicating stubbornness in core inflation.

Gold technical analysis

Gold price is inside the woods from the past week in a range of $1,969-2,014 on a four-hour scale. Lengthy consolidation indicates a sheer volatility contraction, which is expected to be followed by wider ticks and heavy volume after an explosion.

Advancing trendline from March 22 low at $1,934.34 is acting as a cushion for the Gold bulls.

The 20-period Exponential Moving Average (EMA) at $1,990.15 is continuously hovering around the Gold price, hinting at a sideways performance.

Also, the Relative Strength Index (RSI) (14) is oscillating in the 40.00-60.00 range, indicating an absence of a critical trigger.

Gold four-hour chart

XAU/USD

Overview
Today last price	1989.92
Today Daily Change	0.00
Today Daily Change %	0.00
Today daily open	1989.92

Trends
Daily SMA20	1999.67
Daily SMA50	1933.99
Daily SMA100	1897.52
Daily SMA200	1807.42

Levels
Previous Daily High	1995.07
Previous Daily Low	1976.28
Previous Weekly High	2009.41
Previous Weekly Low	1974.13
Previous Monthly High	2009.88
Previous Monthly Low	1809.46
Daily Fibonacci 38.2%	1987.89
Daily Fibonacci 61.8%	1983.46
Daily Pivot Point S1	1979.11
Daily Pivot Point S2	1968.3
Daily Pivot Point S3	1960.32
Daily Pivot Point R1	1997.9
Daily Pivot Point R2	2005.88
Daily Pivot Point R3	2016.69

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

British Pound eases to 1.3450 area following downwardly revised Manufacturing PMI data

The British Pound is trimming previous gains against the US Dollar on Monday, returning to the mid-range of the 1.3400s down from fresh seven-week highs, above 1.3500 earlier on the day. Weaker-than-expected UK manufacturing data added pressure on the Pound, which rallied at the Asian session opening, amid news of a halt to the hostilities in Iran.

EUR/USD challenges 1.1500 on Dollar’s recovery

EUR/USD now accelerates its downtrend and comes closer to the 1.1500 level on Monday. The pair’s correction follows the decent improvement in the US Dollar amid solid data US releases and easing concerns on the geopolitical front.

Gold: The $4,000 mark holds the downside for now

Gold adds to Friday’s pullback, although it remains well underpinned by the key $4,000 threshold per troy ounce on Monday. The US Dollar’s inconclusive price action seems enough to cap the yellow metal’s potential upside, although renewed hopes for a US-Iran peace deal and fading expectations of a Fed rate hike could limit the Greenback’s recovery.

Ethereum Price Forecast: BitMine extends share buyback spree, scoops over 10K ETH

Ethereum (ETH) treasury firm BitMine Immersion Technologies (BMNR) continued its share buyback spree last week after repurchasing 4.5 million shares of its common stock. This purchase brings the total stock buyback since July 1 to 16.1 million shares, part of a previously authorized $4 billion repurchase plan.

AI defies the disinflationary playbook: Why lower oil prices might not be enough to cool core inflation

The global economic landscape has been fixated on the Middle East since the US-Iran war started in late February, reacting to significant changes in crude Oil prices and assessing how they could influence inflation dynamics and growth outlook.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.