Gold Price Forecast: XAU/USD extends its upside above $2,050, all eye on US PCE data


  • Gold price attracts some buyers to $2,055 amid the weaker US Dollar.
  • US Q3 GDP came in weaker than expected, expanding at 4.9%.
  • The markets are pricing in around 79% odds of a rate cut in March.
  • Gold traders await the US Core Personal Consumption Expenditure Price Index (Core PCE), due on Friday.

Gold price (XAU/USD) extends its gains during the early Asian session on Friday. The softer US Dollar (USD) and the downbeat US GDP growth number lends some support to the yellow metal. Gold price currently trades near $2,055, gaining 0.53% on the day.

Meanwhile, the US Dollar Index (DXY), a measure of the value of the USD against a weighted basket of currencies used by US trade partners, has dropped to its lowest level since August, near 101.80. The Treasury yields rose modestly, with the 10-year yield standing at 3.89%.

Data released on Thursdays showed that the US Gross Domestic Product (GDP) for the third quarter came in weaker than expected, expanding at 4.9%, according to the US Bureau of Economic Analysis (BEA) report. Furthermore, Initial claims for unemployment benefits increased by 2,000 to a seasonally adjusted 205,000 for the week ending December 16, worse than the market expectation of 215,000.

Softening US economic data and moderating inflation indicated that the Federal Reserve (Fed) monetary policies are restrictive enough to bring inflation sustainably back to target. Fed committee members expected at least three rate cuts in 2024, and the markets are pricing in around 79% possibility of a rate cut in March, according to the CME FedWatch tool. That being said, the lower US might boost the appeal of gold.

Looking ahead, gold traders will closely monitor November’s US Core Personal Consumption Expenditure Price Index (Core PCE) on Friday. The Fed’s preferred inflation gauge is estimated to show an increase of 0.2% MoM and 3.3% YoY. Furthermore, the University of Michigan Consumer Confidence Survey, Durable Goods Orders report, and New Home Sales data will also be released from the US docket.

 

XAU/USD

Overview
Today last price 2053.84
Today Daily Change 24.00
Today Daily Change % 1.18
Today daily open 2029.84
 
Trends
Daily SMA20 2022.12
Daily SMA50 1988.66
Daily SMA100 1945.78
Daily SMA200 1957.24
 
Levels
Previous Daily High 2043.55
Previous Daily Low 2029.65
Previous Weekly High 2047.93
Previous Weekly Low 1973.13
Previous Monthly High 2052.03
Previous Monthly Low 1931.67
Daily Fibonacci 38.2% 2034.96
Daily Fibonacci 61.8% 2038.24
Daily Pivot Point S1 2025.14
Daily Pivot Point S2 2020.45
Daily Pivot Point S3 2011.24
Daily Pivot Point R1 2039.04
Daily Pivot Point R2 2048.25
Daily Pivot Point R3 2052.94

 

 

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