Gold Price Forecast: XAU/USD traders await key US events

Gold price is trapped by support and resistance ahead of key events.
Bears eye a continuation of the broken-down market.

Ross J Burland FXStreet

Gold price was a touch lower on Monday towards the close on Wall Street. closed with a small loss on Monday as the dollar moved higher ahead of the Wednesday end of the two-day meeting of the Federal Reserve's policy committee. At the time of writing, Gold price was 0.11% offered and had travelled between a high of $1,967.01 and reached a low of $1,949.28.

The main focus for the week will be on the US Consumer Price Index on Tuesday and then the outcome of the Federal Reserve's two-day meeting. The CME Fedwatch tool seeing a 74% chance the meeting will end Wednesday without another rise in interest rates.

''is likely to come down to the wire, but we maintain our long-held view that the Fed will tighten by a final 25bp in June to a range of 5.25%-5.50%. If the Fed decides to 'skip' the June meeting, we expect the decision to be accompanied by communication that leans hawkish (ie. statement, dot plot, and presser), signaling a likely hike in July,'' analysts at TD Securities explained.

Meanwhile, the May inflation rate on Tuesday will be a key focus and could shift the needle in that regard. Markets are expecting prices last month to have risen by 4% annualized last month, this is lower than the 4.9% marked in April.

''Core prices likely stayed firm in May, with the index rising a strong 0.4% m/m for a second straight month, also matching the m/m avg since June 2022,'' analysts at TD Securities said. ''Goods inflation likely stayed positive, with shelter prices remaining the key wildcard (expect slowing). Retreating gas prices (-6% MoM) will drag non-core inflation. Our m/m forecasts imply 4.0%/5.3% YoY for total/core prices.''

Leading into the events, bond yields were mixed. The US two-year note was last seen paying 4.577%, down 2.9 basis points, while the 10-year note was up 3.0 points to 3.772%. The ICE dollar index was last seen trading near 103.62 after moving up from a low of 103.242 and scoring a nearby high of 103.75.

Gold technical analysis

The price is trapped between key breakout support and resistance as illustrated in the daily and 4-hour charts above.

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.