• Gold price meets sellers again above $2,675 heading into the US CPI release.
• Softer US PPI data add to the US Dollar and Treasury bond yields correction.
• Gold price stays hopeful amid the daily chart’s triangle breakout and bullish RSI.

Gold price returns to the red early Wednesday as buyers switch to the sidelines, awaiting the US Consumer Price Index (CPI) data release for further insights on the Federal Reserve’s (Fed) interest rate path.

Gold price eyes US CPI inflation data for cues on Fed’s policy

Gold price reverses a part of the previous day’s rebound as sellers continue to lurk above $2,675. The US Dollar (USD) and the US Treasury bond yields remain subdued so far this Wednesday, unable to lend support to the bright metal. Traders refrain from placing fresh bets on Gold price while cashing on the recent long positions heading into the US CPI test, especially after softer-than-expected Producer Price Index (PPI) readings.

Data published on Tuesday showed that the US annual PPI rose 3.3% in December, missing the expected 3.4% growth, while the core PPI inflation rose to 3.5% year-on-year (YoY) in the same period, compared to the market forecast of 3.8%. Monthly figures also disappointed. Despite the softer data, markets have fully priced in a rate cut pause at the Fed’s policy meeting later this month.

Therefore, the stakes are high for the US CPI report as it could alter the market’s pricing of the Fed rate cut outlook this year. Traders have scaled back their bets to only one Fed rate cut in 2025 from two predicted in December last year, according to the CME Group’s FedWatch Tool, following the strong December US Nonfarm Payrolls (NFP) data.

The hawkish Fed bets are backed by the premise that US President-elect Donald Trump, set to begin his second term next week, will likely fuel inflation with his protectionist policies.

Economists expect the headline US CPI to rise 2.9% YoY in December after increasing 2.7% in November. The annual core CPI inflation is seen steady at 3.3% in the reported period. The monthly CPI inflation will likely remain at 0.3%, while the core figure is set to ease slightly to 0.2% in December.

A hotter-than-expected US CPI report could affirm expectations of just one Fed rate cut this year or prompt markets to price out any easing. This could trigger a fresh sell-off in the non-interest-bearing Gold price. Meanwhile, disappointing CPI figures could provide extra legs to the ongoing bullish momentum.

Gold price technical analysis: Daily chart

Nothing changes for Gold price from a short-term technical perspective, as buyers have entered a bullish consolidation phase following last week’s symmetrical triangle breakout.

The 14-day Relative Strength Index (RSI) continues to hold well above the midline, currently near 56, suggesting that Gold price remains a ‘buy-the-dips’ trade in the coming days.

Gold price needs to find a sustained break above the $2,675 barrier on the way to the $2,700 barrier to regain upside traction.

Daily candlestick closing above that level is critical to extending the uptrend toward the December 12 high of $2,726.

Alternatively, strong support is located at the January 13 low of $2,656, below which sellers must crack the $2,640 demand area.

That zone is the confluence of the 21-day Simple Moving Average (SMA), 50-day SMA, 100-SMA and the triangle convergence, making it a powerful support.

If the downside momentum accelerates, the January 6 low of $2,615 could come to buyers’ rescue.

The GBPUSD price shows additional positive trades to move above 1.2200$, waiting to get negative motive that pushes the price to resume the main bearish trend, which its next main target located at 1.2045$.

We remind you that breaking 1.2180$ will ease the mission to achieve the expected decline, while holding below 1.2300$ represents major condition to the continuation of the bearish trend.

The expected trading range for today is between 1.2120$ support and 1.2290$ resistance

Trend forecast: Bearish

Xerox Holdings’ stock price (XRX) inched higher in the intraday levels, buoyed by positive signals from the RSI as the stock tries to correct the main downward trend while trading alongside the negative trend line in the medium term, with negative pressure due to trading below the 50-day SMA.

Therefore we expect the stock to return lower, targeting the support of $8.04 anew, provided it settles below the resistance of $9.50.

Trend forecast for today: Likely Bearish 

XAU/USD Current price: $2,672.99

• The United States Producer Price Index rose by less than anticipated in December.
• Speculative interest continues to trade on sentiment and Donald Trump’s headlines.
• XAU/USD ticks higher as the sentiment deteriorates, limited directional strength.

Spot Gold trades within familiar levels on Tuesday as a better market mood weighed on safe-haven demand throughout the first half of the day. The sentiment improved on headlines indicating that President-elect Donald Trump’s team is considering gradual tariff increases over the upcoming months to prevent a sudden increase in inflation. The plan, not confirmed neither deny by Trump at the time being, implies 2% to 5% tariffs increased per month.

Meanwhile, the United States (US) reported that wholesale-level inflation rose by less than anticipated in December. The Producer Price Index (PPI) rose 0.2% in the month, below the previous 0.4% and the expected 0.3%. On a yearly basis, the PPI was up 3.3%,  missing expectations of 3.4%. Finally, the core annual reading resulted at 3.5%, ticking higher from the 3.4% posted in November yet below the 3.8% anticipated by market players.

The positive mood receded as the American session developed, and the three major US indexes trade in the red.

The news reinforced speculation the Federal Reserve (Fed) will keep interest rates at their current levels for longer than previously anticipated. Speculative interest is now waiting for the US December Consumer Price Index (CPI), to be out on Wednesday. Meanwhile, the United Kingdom (UK) will also unveil CPI figures earlier in the day.

XAU/USD short-term technical outlook

XAU/USD hovers around $2,670, and the daily chart shows that bulls are cautiously adding. The pair remains above its moving averages, albeit a bullish 100 Simple Moving Average (SMA) is about to cross above a flat 20 SMA, signaling receding buying interest. Technical indicators, however, have resumed their advances within positive levels, limiting the odds of a relevant leg south.

In the 4-hour chart, a directionless 20 SMA has rejected advances since the week started, now acting as dynamic resistance at around $2,674.00. The 100 and 200 SMAs are also flat, yet well below the current level. Finally, technical indicators have ticked higher, although in neutral-to-bearish territory.

Support levels: 2,660.70 2,645.15 2,635.00

Resistance levels: 2,675.00 2,683.20 2,697.90

• Silver price tests immediate resistance at the 14-day EMA of $29.83 level.
• The 14-day RSI consolidates around the 50 level, indicating a neutral market outlook.
• The pair may test initial support at the four-month low of $28.74, recorded on December 19.

Silver price (XAG/USD) recovers some of their recent losses from the previous session, trading near $29.80 per troy ounce during European trading hours on Tuesday. Analyzing the daily chart suggests that short-term price momentum appears neutral, with the XAG/USD pair positioned around the nine-day and 14-day Exponential Moving Averages (EMAs). A breakout in either direction could signal a clearer trend.

Moreover, the 14-day Relative Strength Index (RSI) hovers near the 50 level, suggesting a neutral outlook. This suggests the market is evenly balanced, with no clear indication of overbought or oversold conditions, reflecting equilibrium between bullish and bearish momentum.

Silver price currently tests resistance at the immediate 14-day EMA of $29.83, followed closely by the nine-day EMA at $29.84. A breakout above these levels could boost market sentiment and drive the XAG/USD pair toward the key psychological level of $30.00. A sustained move beyond this threshold may strengthen bullish momentum, potentially setting the stage for the grey metal to target its two-month high of $32.28, last achieved on December 9.

On the downside, initial support is located at the four-month low of $28.74, recorded on December 19, followed by the critical psychological level of $28.00. A break below these levels could intensify bearish momentum and signal further downside potential for Silver price.

XAG/USD: Daily Chart

• Silver struggles to gain any meaningful traction and seems vulnerable to sliding further.
• The overnight failure near the 100-day EMA supports prospects for additional losses.
• A sustained strength beyond the $30.50-$30.55 area will negate the negative outlook.

Silver (XAG/USD) ticks higher during the Asian session on Tuesday, though it lacks bullish conviction and seems vulnerable to extending the previous day’s retracement slide from the vicinity of a four-week top. The white metal currently trades around the $29.65 region, up 0.15% for the day. 

From a technical perspective, Monday’s failure near the 100-day Exponential Moving Average (EMA) suggests that the recent recovery from the $28.80-$28.75 region has run out of steam and validates the negative outlook. That said, mixed oscillators on the daily chart warrant some caution before placing fresh bearish bets around the XAG/USD and positioning for deeper losses.

In the meantime, the $30.00 psychological mark now seems to act as an immediate hurdle ahead of the $30.50-$30.55 region (100-day EMA). A sustained move beyond the latter might shift the near-term bias in favor of bullish traders and lift the XAG/USD beyond an intermediate resistance near the $31.00 round figure, towards the next relevant barrier near the $31.35-$31.40 zone. 

On the flip side, weakness below the mid-$29.00s will reaffirm the bearish outlook and make the XAG/USD vulnerable to retest the $29.00 mark before eventually dropping to the $28.80-$28.70 region, or a three-month low touched in December. The downward trajectory could extend further towards the $28.45-$28.40 area en route to the $28.00 mark and the $27.70-$27.65 support.

XAG/USD daily chart

• Gold price rebounds above $2,660 early Tuesday, with eyes on key US inflation data.
• Speculations surrounding Trump’s tariff plans drive US Dollar and Gold price action.
• Technically, Gold price appears as a ‘buy-the-dip’ trade on the daily time frame.

Gold price is back on the bids in Asian trading on Tuesday, having found fresh buyers near the $2,660 region. Gold buyers try their luck again heading into the US inflation test, with the Producer Price Index (PPI) slated for release later in the day.

Gold price regains traction amid Trump’s tariffs chatter

The US Dollar (USD) consolidates its overnight retreat while the US Treasury bond yields lick their wounds early Tuesday, allowing Gold price to make another run toward the $2,700 barrier.

The risk-on rally in Chinese equities lifts the broader market sentiment, keeping the safe-haven USD on edge. Investors remain expectant of more stimulus from China, especially after recent Chinese efforts to support the Yuan and economic growth.

Goldman Sachs Chief Economist Jan Hatzius said: “China plans to implement a variety of stimulus measures to counter the impact of anticipated US tariffs and a continued housing market downturn.”

Markets also cash in on their USD longs ahead of the top-tier US PPI data, which will likely be closely scrutinized in the lead-up to Wednesday’s Consumer Price Index (CPI) showdown.

Traders have scaled back their bets for a US Federal Reserve (Fed) interest rate cut this year to only one from two predicted in December last year, according to the CME Group’s FedWatch Tool, following a strong US Nonfarm Payrolls report released on Friday.

Therefore, the US inflation data are critical to affirming the hawkish Fed expectations, significantly impacting the Greenback alongside the Gold price. The annual US PPI inflation is expected to increase to 3.4% in December from 3% in November, while core PPI is seen rising 3.7% in the same period after reporting a 3.4% growth previously.

Hot inflation data could revive the US Dollar’s demand and resume the Gold price correction. However, the Gold price could recapture $2,700 and beyond on a downside surprise to the PPI print, prompting markets to prepare for a softer CPI report on Wednesday. It’s worth nothing that any chatter about Trump’s tariff plans could also play a pivotal role in the Gold price action.

Gold price corrected from a monthly high on Monday despite increased inflationary concerns in the incoming US President Donald Trump’s 2.0 era. Gold price is considered as a hedge against inflation.

Additionally, the bright metal failed to benefit from a sharp pullback in the US Dollar and the US Treasury bond yields after a Bloomberg report. Citing people familiar with the matter, Bloomberg reported late Monday that advisors on Trump’s incoming economic team are considering gradually implementing tariffs, increasing them incrementally each month by 2% to 5% per month.

Gold price technical analysis: Daily chart

The short-term technical outlook for Gold price remains more or less the same, with more upside likely in the offing following the previous week’s symmetrical triangle breakout.

The 14-day Relative Strength Index (RSI) points north above the midline, currently near 55, adding credence to the bullish potential in Gold price.

Gold price looks to take out the $2,700 barrier should buyers extend control.  

The next upside barriers are aligned at the $2,710 round level and the December 12 high of $2,726.

On the other side, strong support is around $2,641, where the 50-day SMA coincides with the triangle resistance.

On sustained declines, Gold price could find immediate respite at $2,635, the confluence of the 21-day SMA and the 100-day SMA.

The last line of defense for Gold buyers is seen at the January 6 low of $2,615.

Bearish Reaction May Continue

Certainly, today’s bearish reaction to new highs seems to lower the chance for a new trend high in the short term. At least until after there is a test of lower support levels. There are a few things to be aware of. Notice that resistance was seen around the confluence of several technical price targets, beginning with 4.33. A rising ABCD pattern (purple) reached its initial target from the pattern and therefore identified a possible pivot level. So far, the market reaction confirms this.

Upside Target Reached

In addition, to completing a target for the ABCD pattern today, a breakout above the top trendline of a rising channel also triggered on the way to 4.37. Resistance was seen around that line on the most recent swing high of 4.20. So, today’s price action shows a failed breakout of the channel. Once a failure occurs, the possibility of a swing in the other direction increases. That is what is being shown so far.

Key Support Anchored by 20-Day MA

The first lower trend support area is around the 20-Day MA, now at 3.62, along with an internal uptrend line. Moreover, the 20-Day line can be combined with the 50% retracement at 3.67 and the 2023 swing high of 3.64. The 2023 high has some significance and therefore a solid chance of being tested as support during a correction. Having the 20-Day line and 50% retracement nearby increases the chance for signs of support.

For a look at all of today’s economic events, check out our economic calendar.

XAU/USD Current price: $2,663.89

• In the absence of macroeconomic figures, sentiment leads the way across financial boards.
• Fresh UK and US inflation data and President-elect Donald Trump in the eye of the storm.
• XAU/USD trades with a soft tone and could reach lower lows in the near term.

Spot Gold is on the back foot on Monday amid persistent US Dollar’s (USD) demand. The XAU/USD hit a multi-week high of $2,697.88 on Friday, as a solid United States (US) monthly employment report spurred risk aversion. The Nonfarm Payrolls (NFP) report showed the country added 256,000 new jobs in December, while the Unemployment Rate edged lower to 4.1%. The figures were upbeat. Even further,  Average Hourly Earnings rose by 3.9%, easing from the previous 4%. The combined headlines hint at an on-hold Federal Reserve (Fed) for longer.

Demand for safety equally benefited Gold and the Greenback at the end of the previous week, yet persistent USD demand finally took its toll on XAU/USD, now trading at around $2,665. In the absence of relevant macroeconomic data, the focus remained on sentiment, and stocks’ behaviour. Asian and European indexes closed in the red, while Wall Street trades mixed: only the Dow Jones Industrial Average trades in the green after collapsing on Friday, while the S&P500 and the Nasdaq Composite remain in the red.

Meanwhile, the focus this week will be on inflation. The United Kingdom (UK) and the US will release fresh Consumer Price Index (CPI) figures next Wednesday. Market participants will also be waiting for President-elect Donald Trump and tariffs updates.

XAU/USD short-term technical outlook

From a technical point of view, the daily chart for the XAU/USD pair shows sellers have gained courage, yet at stepper decline is far from evident. The pair remains above all its moving averages, although a mildly bearish 20 Simple Moving Average (SMA) converges with a bullish 100 SMA at around $2,635. Technical indicators, in the meantime, turned sharply lower, yet remain within positive levels.

In the 4-hour chart, Gold is developing below its 20  SMA, which lost its bullish strength and provides resistance at around $2,672. The 100 and 200 SMAs, in the meantime, remain flat below the current level. Finally, technical indicators head firmly south, pressuring their midlines straight from overbought readings, suggesting the near-term slide could continue.

Support levels: 2,660.70 2,645.15 2,635.00

Resistance levels: 2,672.20 2,683.20 2,697.90

Natural Gas Technical Analysis

The natural gas markets have shown quite a bit of upward momentum. But really, at this point in time, I think you have to look at them through the prism of how many rallies do we have left in the winter? Clearly, we’re in one. Now, the question of course will be whether or not we can break to the $4.50 level. If we can break there, then it’s likely that we could see a lot of upward momentum, perhaps to the $5 level. Ultimately, this is a market that I have no interest in shorting whatsoever. So, with that being the case, I’m just looking for dips to buy.

The $4 level should be support as well, but I also think there’s probably even more support at the $3.60 level. Sooner or later, we are going to focus on spring, but we’ve got some time before that. So, I think we’ve got one, maybe two more bounces and shots higher before we turn around and start focusing on winter being gone. The market breaking down below the $3.40 level could of course break things down significantly, but we’re so far away from that right now, it’s not really a concern of mine.