Gold Price Forecast: XAU/USD to tick down on strong US CPI report
Gold is likely to remain inversely correlated with the benchmark 10-year US T-bond yield next week as investors will await the US January Consumer Price Index (CPI) data, which could impact the market odds of a 50 basis points (bps) Fed rate hike in March, FXStreet’s Eren Sengezer reports.
Next week's US CPI data could trigger a big reaction in XAU/USD
“On Thursday, the US Bureau of Labor Statistics will release CPI data. On a yearly basis, the CPI is forecast to rise to 7.2% from 7% in December. A stronger-than-expected reading could ramp up the probability of a 50 bps hike in March and weigh on XAU/USD.”
“In case the price stays above $1,805 (200-day SMA) and starts using this level as support, the next target on the upside is located at $1,820 (20-day SMA, Fibonacci 38.2% retracement of December-February uptrend) before $1,830 (Fibonacci 23.6% retracement).”
“In case $1,805 is confirmed as resistance, gold needs to make a daily close below $1,800 (100-day SMA, Fibonacci 61.8% retracement) to convince bears. In that case, $1,780 (static level) aligns as the next support.”
Author
FXStreet Insights Team
FXStreet
The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.
