• Gold price holds the bounce off the $2,350 level as Friday’s trading kicks off.  
• US Dollar rebound falters with US Treasury bond yields, supporting the Gold price upswing.
• China’s economic woes remain a cause for concern while September Fed rate cut odds stay intact.
• Gold buyers defend 50-day SMA at $2,360 head into the monthly US PCE data release.

Gold price has managed to defend the key support near $2,360, consolidating weekly losses in Friday’s Asian session. Traders now shift their focus toward the monthly release of the US Personal Consumption Expenditures (PCE) Price Index after Thursday’s second-quarter Gross Domestic Product (GDP).

Will US inflation data trigger a fresh leg lower in Gold price?

US GDP expanded at an annualized rate of 2.8% in Q2 2024, doubling from the 1.4% growth reported in the previous quarter. The US Dollar (USD) jumped higher in an immediate reaction to the US GDP report but quickly returned to a familiar range, as markets digested the quarterly core PCE inflation and Jobless Claims data.

“The core PCE deflator (the Federal Reserve’s preferred inflation measure) rose 2.9% at an annualized rate in Q2, down from 3.7% in the previous quarter, indicating a moderation in inflationary pressure,” analysts at RBC Economics noted. Meanwhile, Initial Jobless Claims dropped 10,000 to a seasonally adjusted 235,000 for the week ended July 20, the Labor Department said on Thursday. 

Markets continued to fully price in a US Federal Reserve (Fed) interest-rate cut in September, despite the acceleration in the US economic growth, as disinflation remains in progress. Gold price initially reacted negatively to the US GDP release, accelerating its downside to over two-month lows of $2,353 but staged a modest comeback on softer US core PCE inflation reading, settling Thursday above the key support at $2,360.

In the first half of Thursday’s trading, Gold price tumbled over 1%, having faced rejection at $2,400, undermined by profit-taking amid the market’s repositioning ahead of high-impact US economic data. China’s economic slowdown concerns also played a part in the Gold price sell-off, as investors raised demand concerns from the world’s top yellow metal consumer.

Gold buyers also found some respite from the persistent weakness in the USD/JPY pair, as the Japanese Yen carry trading unwinding gathered pace ahead of next week’s Bank of Japan’s (BoJ) policy meeting. Odds of a BoJ rate hike next week are on the rise, with additional credence coming in from Tokyo inflation data released early Friday.

Later on Friday, the annual core US PCE Price Index is expected to show an increase of 2.5% in June, a tad softer than the 2.6% booked in May. The headline annual figure is also expected to rise by 2.5% in the same period. An in-line with market expectations or a softer-than-expected US core PCE inflation print is likely to serve as a saving grace to Gold buyers.

The reaction to the data is mostly discount after Thursday’s quarterly core PCE data but the end-of-the-week flows and positions adjustments, ahead of the Fed policy announcements and Nonfarm Payrolls data next week, could spike up volatility around Gold price.

Gold price technical analysis: Daily chart

Gold sellers retain control early Friday, with the 14-day Relative Strength Index (RSI) holding its position below the 50 level, currently near 46.

They are once again attacking the key 50-day Simple Moving Average (SMA) at $2,360. Gold price needs a daily close below that level to initiate a fresh downtrend toward the 100-day SMA support at $2,324.

Buyers, however, could find support again at the $2,350 psychological level

On the flip side, the immediate resistance is seen at the previous support of the 21-day SMA at $2,387, above which the $2,400 mark could be retested.

The next recovery targets are seen at the $2,412 area and the $2,425 static resistance.

• Gold price holds the bounce off the $2,350 level as Friday’s trading kicks off.  
• US Dollar rebound falters with US Treasury bond yields, supporting the Gold price upswing.
• China’s economic woes remain a cause for concern while September Fed rate cut odds stay intact.
• Gold buyers defend 50-day SMA at $2,360 head into the monthly US PCE data release.

Gold price has managed to defend the key support near $2,360, consolidating weekly losses in Friday’s Asian session. Traders now shift their focus toward the monthly release of the US Personal Consumption Expenditures (PCE) Price Index after Thursday’s second-quarter Gross Domestic Product (GDP).

Will US inflation data trigger a fresh leg lower in Gold price?

US GDP expanded at an annualized rate of 2.8% in Q2 2024, doubling from the 1.4% growth reported in the previous quarter. The US Dollar (USD) jumped higher in an immediate reaction to the US GDP report but quickly returned to a familiar range, as markets digested the quarterly core PCE inflation and Jobless Claims data.

“The core PCE deflator (the Federal Reserve’s preferred inflation measure) rose 2.9% at an annualized rate in Q2, down from 3.7% in the previous quarter, indicating a moderation in inflationary pressure,” analysts at RBC Economics noted. Meanwhile, Initial Jobless Claims dropped 10,000 to a seasonally adjusted 235,000 for the week ended July 20, the Labor Department said on Thursday. 

Markets continued to fully price in a US Federal Reserve (Fed) interest-rate cut in September, despite the acceleration in the US economic growth, as disinflation remains in progress. Gold price initially reacted negatively to the US GDP release, accelerating its downside to over two-month lows of $2,353 but staged a modest comeback on softer US core PCE inflation reading, settling Thursday above the key support at $2,360.

In the first half of Thursday’s trading, Gold price tumbled over 1%, having faced rejection at $2,400, undermined by profit-taking amid the market’s repositioning ahead of high-impact US economic data. China’s economic slowdown concerns also played a part in the Gold price sell-off, as investors raised demand concerns from the world’s top yellow metal consumer.

Gold buyers also found some respite from the persistent weakness in the USD/JPY pair, as the Japanese Yen carry trading unwinding gathered pace ahead of next week’s Bank of Japan’s (BoJ) policy meeting. Odds of a BoJ rate hike next week are on the rise, with additional credence coming in from Tokyo inflation data released early Friday.

Later on Friday, the annual core US PCE Price Index is expected to show an increase of 2.5% in June, a tad softer than the 2.6% booked in May. The headline annual figure is also expected to rise by 2.5% in the same period. An in-line with market expectations or a softer-than-expected US core PCE inflation print is likely to serve as a saving grace to Gold buyers.

The reaction to the data is mostly discount after Thursday’s quarterly core PCE data but the end-of-the-week flows and positions adjustments, ahead of the Fed policy announcements and Nonfarm Payrolls data next week, could spike up volatility around Gold price.

Gold price technical analysis: Daily chart

Gold sellers retain control early Friday, with the 14-day Relative Strength Index (RSI) holding its position below the 50 level, currently near 46.

They are once again attacking the key 50-day Simple Moving Average (SMA) at $2,360. Gold price needs a daily close below that level to initiate a fresh downtrend toward the 100-day SMA support at $2,324.

Buyers, however, could find support again at the $2,350 psychological level

On the flip side, the immediate resistance is seen at the previous support of the 21-day SMA at $2,387, above which the $2,400 mark could be retested.

The next recovery targets are seen at the $2,412 area and the $2,425 static resistance.

Bullish Reversal Triggers on Monday

On Monday natural gas showed strength as upward momentum kicked in triggering a bullish breakout of the internal downtrend line. The day ended with a wide range green candlestick pattern and a five-day closing high. This is bullish behavior that indicates there is likely more upside to go. A low volatility day following yesterday’s sharp move should be healthy for developing rally. Last week’s high of 2.285 is the next upside pivot.

First Upside Target is the 20-Day MA

There are a couple of initial higher targets that are well identified. Simplified, the 20-Day MA is at 2.36 and it can also be used as a guide relative to the top downtrend line. If that level is broken to the upside, the 200-Day MA comes into sight at 2.43. There are additional price target levels around the 200-Day line that generate an area of possible resistance. They include the 38.2% Fibonacci retracement at 2.45 and a prior swing low around 2.48.

Since the 38.2% retracement is generally considered a minimum potential retracement in Fibonacci analysis, it seems that the 2.45 level has a good chance of being hit. Certainly, given the relationship to the downtrend line, the 20-Day line should be reached at a minimum. Once there was an upside breakout of the internal downtrend line the higher trendline became a target.

Higher Target Zone up at 2.56

Subsequently, if an upside breakout above the 200-Day line can be maintained, the chance of reaching a higher target zone from around 2.56 to 2.59 improves. That price zone comes from the 50-Day MA and 50% retracement, respectively. Notice that an advance above the 200-Day line puts natural gas above the top downtrend line, one indication further confirming a bullish reversal of the recent bearish correction.

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

• I recognize that we have bounced quite significantly from a crucial support level underneath.
• Spot natural gas continues to look at the $2.00 level as a major barrier, and we have rallied quite a bit since we got closer to that region.
• By doing so, it does suggest that the market is more likely than not going to try to jump into some type of recovery phase, but also, it’s worth noting that this time of year is typically somewhat tougher natural gas, so I think we just got oversold.

Technical Analysis

The technical analysis for this market is rather bullish, and at this point I think it’s worth noting that the $2.00 level is not only previous support and resistance, but it is also an area that has a lot of psychology attached to it. Because of this, it’s not overly surprising to see this market bounce from there. That being said, I don’t necessarily think that we are going to start a huge new bullish market at the moment, but we should be paying attention to the 50-Day EMA above, which is closer to the $2.42 level, and is dropping. I think we can break above there, then it’s obvious that the natural gas market could pick up a little bit of momentum.

There is a lot of heat in the western part of the United States right now, so demand for natural gas probably will pick up, but at the end of the day it’s probably also worth noting that we are typically very soft this time of year, and I think we are in a situation where traders will continue to look at this through the prism of building up a bigger position for the fall. After all, when natural gas really starts to take off is when the heat demands, and the United States start increasing. Right now, we are nowhere near there, but as we get deeper into the year as far as futures markets are concerned, it then makes the idea of buying natural gas much more sensible. In other words, I think you can buy on the dip, but I would not do so with a huge position.

Ready to trade our daily Forex forecast? Here’s some of the top demo trading accounts to check out. 

XAU/USD Current price: $2,404.79

• Key earnings reports and upcoming US first-tier events push investors to the sidelines.
• Treasury yields shed some ground, weighing on the US Dollar.
• XAU/USD bounced back, but additional gains in the near term seem unlikely.

Spot Gold recovered on Tuesday, changing hands at $2,403 a troy ounce. XAU/USD bounced from a weekly low of $2,383.78 posted on Monday as demand for the US Dollar receded ahead of United States (US) first-tier data and key earnings reports. Nevertheless, market participants are increasing their bets that the Federal Reserve (Fed) will deliver a 25 basis point (bps) interest rate cut in September and a similar one in December, also limiting the USD bullish potential.

Finally, easing government bond yields undermines demand for the Greenback. The 10-year Treasury note currently offers 4.23%, while the 2-year note yields 4.49%, down roughly 3 bps each.

A scarce macroeconomic calendar and upcoming US first-tier events further exacerbate the lack of clear directional strength. Investors are waiting for the preliminary estimate of the Q2 Gross Domestic Product (GDP) to be out on Friday, alongside revisions for the Personal Consumption Expenditures (PCE) Price Index in the same period,  the Fed’s favourite inflation gauge. Furthermore, the country will release the June PCE inflation data on Friday, which will have a lesser impact than usual but will still affect the USD.

XAU/USD short-term technical outlook  

The daily chart for the XAU/USD pair shows it is bouncing from the 50% Fibonacci retracement of the $2,293.54/$2,483.68 rally at $2,389.30. At the same time,  a bullish 20 Simple Moving Average (SMA) heads higher just below the mentioned Fibonacci level, while the longer ones also advance below the longer ones, in line with the dominant bullish trend. Finally, the Momentum indicator maintains its downward slope within positive levels, while the Relative Strength Index (RSI) has turned marginally higher at around  54, supporting another leg higher.

In the near term, and according to the 4-hour chart, an upward extension seems limited. XAU/USD topped around the 38.2% retracement of the mentioned rally, providing statict resistance at $2,411.25. Furthermore, a bearish 20 SMA converges with the Fibonacci level, reinforcing it. Meanwhile, the Momentum indicator aims north at around its 100 line, while the RSI indicator remains directionless at 42.

Support levels: 2,389.30 2,377.10 2,364.00  

Resistance levels: 2,411.25 2,425.70 2,439.90

XAU/USD Current price: $2,404.79

• Key earnings reports and upcoming US first-tier events push investors to the sidelines.
• Treasury yields shed some ground, weighing on the US Dollar.
• XAU/USD bounced back, but additional gains in the near term seem unlikely.

Spot Gold recovered on Tuesday, changing hands at $2,403 a troy ounce. XAU/USD bounced from a weekly low of $2,383.78 posted on Monday as demand for the US Dollar receded ahead of United States (US) first-tier data and key earnings reports. Nevertheless, market participants are increasing their bets that the Federal Reserve (Fed) will deliver a 25 basis point (bps) interest rate cut in September and a similar one in December, also limiting the USD bullish potential.

Finally, easing government bond yields undermines demand for the Greenback. The 10-year Treasury note currently offers 4.23%, while the 2-year note yields 4.49%, down roughly 3 bps each.

A scarce macroeconomic calendar and upcoming US first-tier events further exacerbate the lack of clear directional strength. Investors are waiting for the preliminary estimate of the Q2 Gross Domestic Product (GDP) to be out on Friday, alongside revisions for the Personal Consumption Expenditures (PCE) Price Index in the same period,  the Fed’s favourite inflation gauge. Furthermore, the country will release the June PCE inflation data on Friday, which will have a lesser impact than usual but will still affect the USD.

XAU/USD short-term technical outlook  

The daily chart for the XAU/USD pair shows it is bouncing from the 50% Fibonacci retracement of the $2,293.54/$2,483.68 rally at $2,389.30. At the same time,  a bullish 20 Simple Moving Average (SMA) heads higher just below the mentioned Fibonacci level, while the longer ones also advance below the longer ones, in line with the dominant bullish trend. Finally, the Momentum indicator maintains its downward slope within positive levels, while the Relative Strength Index (RSI) has turned marginally higher at around  54, supporting another leg higher.

In the near term, and according to the 4-hour chart, an upward extension seems limited. XAU/USD topped around the 38.2% retracement of the mentioned rally, providing statict resistance at $2,411.25. Furthermore, a bearish 20 SMA converges with the Fibonacci level, reinforcing it. Meanwhile, the Momentum indicator aims north at around its 100 line, while the RSI indicator remains directionless at 42.

Support levels: 2,389.30 2,377.10 2,364.00  

Resistance levels: 2,411.25 2,425.70 2,439.90

• Gold price clings to $2,400, snapping a four-day downtrend early Tuesday.
• The US Dollar turns south with US Treasury bond yields, despite risk-off returning.    
• China’s economic worries could act as a headwind for Gold price.
• The daily technical setup continues to favor Gold buyers but $2,425 holds the key.

Gold price is making another attempt to reclaim $2,400 on a sustained basis, replicating the moves seen during Monday’s Asian trading. Gold price appears to be benefiting from a typical market caution and renewed China’s economic worries and ahead of key US earnings reports.

Gold price awaits fresh catalysts for a clear direction

Despite the return of risk-off flows, the US Dollar (USD) turns defensive, tracking the retreat in the US Treasury bond yields from two-week highs. Reports that US Vice President Kamala Harris secured 1976 delegates to become the Democratic Party’s presumptive nominee for November’s presidential election exert downward pressure on the Greenback.

It’s worth noting that Donald Trump’s chances of winning the election have narrowed after Joe Biden stepped down to allow Harris to run for the White House.  A Democratic win in the US presidency would imply higher taxes and the need for lower borrowing costs, suggesting that the US Federal Reserve (Fed) would have to keep the policy accommodative. This, in turn, would be bearish for the US Dollar in the long term.

Traders turn risk-averse, as worries over China’s economic slowdown mount while nervousness sets in before earnings at Tesla and Alphabet are due after Tuesday’s New York close. Investors scurry for safety in the traditional safe-haven Gold during such times. However, China is the world’s top yellow metal consumer and the slowing growth raises concerns over its physical demand for Gold.

According to Goldman Sachs, “Chinese gold demand is now cyclically soft due to recent price surges, but central banks in emerging markets including China are likely to continue to buy gold frequently, whether disclosed or not,” per Reuters.

Traders also eagerly await the US Gross Domestic Product (GDP) report for the second quarter on Thursday and Personal Consumption Expenditures (PCE) inflation data for June on Friday before placing any directional bets on the Gold price.

In the meantime, the mid-tier US housing data, the political developments and the corporate earnings will drive risk trends, eventually impacting the USD-denominated Gold price.

From a broader perspective, Gold price remains supported by the Fed interest-rate cut expectations, with a September easing almost a done deal. Markets are currently pricing in a September rate cut, as futures show a 97% chance, according to the CME Group’s FedWatch Tool.

Gold price technical analysis: Daily chart

Gold price stays supported so long as the 14-day Relative Strength Index (RSI) holds above the 50 level. The indicator is currently at 53.50.

The 21-day  and 50-day Simple Moving Averages (SMA) Bull Cross also remains in play, justifying the constructive outlook for Gold price.

if the Gold price rebound gathers strength, the $2,425 static resistance will be tested. The next topside barrier is seen at the previous lifetime high at $2,450, above which buyers will target the new all-time high of $2,484 reached last week.

On the other side, should sellers return, Gold price could test the 21-day SMA at $2,379 before falling further to the 50-day SMA support at $2,361.

The last line of defense for Gold optimists is seen at the $2,350 psychological level.

• Gold price clings to $2,400, snapping a four-day downtrend early Tuesday.
• The US Dollar turns south with US Treasury bond yields, despite risk-off returning.    
• China’s economic worries could act as a headwind for Gold price.
• The daily technical setup continues to favor Gold buyers but $2,425 holds the key.

Gold price is making another attempt to reclaim $2,400 on a sustained basis, replicating the moves seen during Monday’s Asian trading. Gold price appears to be benefiting from a typical market caution and renewed China’s economic worries and ahead of key US earnings reports.

Gold price awaits fresh catalysts for a clear direction

Despite the return of risk-off flows, the US Dollar (USD) turns defensive, tracking the retreat in the US Treasury bond yields from two-week highs. Reports that US Vice President Kamala Harris secured 1976 delegates to become the Democratic Party’s presumptive nominee for November’s presidential election exert downward pressure on the Greenback.

It’s worth noting that Donald Trump’s chances of winning the election have narrowed after Joe Biden stepped down to allow Harris to run for the White House.  A Democratic win in the US presidency would imply higher taxes and the need for lower borrowing costs, suggesting that the US Federal Reserve (Fed) would have to keep the policy accommodative. This, in turn, would be bearish for the US Dollar in the long term.

Traders turn risk-averse, as worries over China’s economic slowdown mount while nervousness sets in before earnings at Tesla and Alphabet are due after Tuesday’s New York close. Investors scurry for safety in the traditional safe-haven Gold during such times. However, China is the world’s top yellow metal consumer and the slowing growth raises concerns over its physical demand for Gold.

According to Goldman Sachs, “Chinese gold demand is now cyclically soft due to recent price surges, but central banks in emerging markets including China are likely to continue to buy gold frequently, whether disclosed or not,” per Reuters.

Traders also eagerly await the US Gross Domestic Product (GDP) report for the second quarter on Thursday and Personal Consumption Expenditures (PCE) inflation data for June on Friday before placing any directional bets on the Gold price.

In the meantime, the mid-tier US housing data, the political developments and the corporate earnings will drive risk trends, eventually impacting the USD-denominated Gold price.

From a broader perspective, Gold price remains supported by the Fed interest-rate cut expectations, with a September easing almost a done deal. Markets are currently pricing in a September rate cut, as futures show a 97% chance, according to the CME Group’s FedWatch Tool.

Gold price technical analysis: Daily chart

Gold price stays supported so long as the 14-day Relative Strength Index (RSI) holds above the 50 level. The indicator is currently at 53.50.

The 21-day  and 50-day Simple Moving Averages (SMA) Bull Cross also remains in play, justifying the constructive outlook for Gold price.

if the Gold price rebound gathers strength, the $2,425 static resistance will be tested. The next topside barrier is seen at the previous lifetime high at $2,450, above which buyers will target the new all-time high of $2,484 reached last week.

On the other side, should sellers return, Gold price could test the 21-day SMA at $2,379 before falling further to the 50-day SMA support at $2,361.

The last line of defense for Gold optimists is seen at the $2,350 psychological level.

Bullish Momentum Points to Higher Targets Starting with 2.39

Today’s sharp rally triggered a breakout of the internal downtrend line, and the subsequent strong bullish reaction shows the market aware of the line. Once the internal downtrend line is broken, the higher trendline becomes a target. Since the purple 20-Day MA, currently at 2.39, recently converged with the higher downtrend line, it can be watched together with the trendline as a potential resistance zone. Moreover, the 20-Day line is quickly followed by a confluence of indicators showing potential resistance at a range from 2.44 to 2.48. It starts with the blue 200-Day MA at 2.44, and includes the 38.2% Fibonacci retracement at 2.45, then ends at an interim swing low of 2.475 from May 28.

The May 28 swing low had significance previously as it was part of the rising price structure of higher swing lows and higher swing highs. Once it was broken to the downside following the June 11 trend high, another bearish reversal signal was indicated. It happened to correlate with support around the 200-Day MA at the time.

Higher Target Zone Begins at 2.57

In case the 2.475 level is broken to the upside, the next higher price zone looks to be from 2.57 to 2.59. The first level is the orange 50-Day MA and the second is the 50% retracement zone at 2.59. Of course, if this higher price level is reached, natural gas will be back above the 200-Day line, 20-Day line and downtrend line, a sign of strength.

Weakness an Opportunity to Position for Upside Continuation

Given the above short-term bullish scenario pullbacks into today’s price range of 2.09 to 2.27 will likely be used by traders as an opportunity to position themselves for a continuation of today’s bounce. If last week’s low completed the retracement, then not only is the 20-Day MA an initial target, but today’s bullish momentum may be the beginning of an advance that eventually attempts another breakout of the top long-term downtrend line.

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

XAU/USD Current price: $2,392.80

• Wall Street recovers amid mounting speculation Donald Trump could win the US elections.
• United States first-tier data to be out later in the week keeps investors in cautious mode.
• XAU/USD remains under selling pressure in the near term, support at $2,377.10.

Spot Gold keeps marching south on Monday, with XAU/USD trading at around $2,390. The bright metal peaked last week at a record high of $2,483.63, retreating afterwards straight to the current levels. The US Dollar gained upward traction after Wall Street’s opening, while stocks recover following one of the worst weeks of the year.

Optimism seems to be benefiting the American currency despite political noise from the weekend. President Joe Biden decided to step down from the presidential race, which ended up boosting hopes for a Donald Trump victory, known for being more “pro-market.”

Meanwhile, upcoming United States (US) first-tier figures maintain investors in wait-and-see mode. The country will publish this week the first estimate of the Q2 Gross Domestic Product (GDP), alongside a revision of the Fed’s favorite inflation gauge for the first quarter, the Personal Consumption Expenditures (PCE) Price Index. Additionally, the US will release June PCE inflation on Friday.

XAU/USD short-term technical outlook  

The XAU/USD pair is down for a fourth consecutive day, with the slide decelerating, suggesting the correction may soon be over. The daily chart shows the pair holds above a bullish 20 Simple Moving Average (SMA) which advances above also ascending 100 and 200 SMAs while providing dynamic support at around $2,377.10. Meanwhile, the technical indicators are losing their downward strength within positive levels, near completing the overbought correction.

In hte near term, and according to the 4-hour chart, the risk remains skewed to the downside. XAU/USD trades below a firmly bearish 20 SMA, while pressures a mildly bullish 100 SMA, suggesting continued selling pressure. At the same time technical indicators head south near oversold readings, with no signs of changing course.

Support levels: 2,377.10 2,364.00 2,349.50

Resistance levels: 2,412.10 2,425.70 2,439.90

XAU/USD Current price: $2,392.80

• Wall Street recovers amid mounting speculation Donald Trump could win the US elections.
• United States first-tier data to be out later in the week keeps investors in cautious mode.
• XAU/USD remains under selling pressure in the near term, support at $2,377.10.

Spot Gold keeps marching south on Monday, with XAU/USD trading at around $2,390. The bright metal peaked last week at a record high of $2,483.63, retreating afterwards straight to the current levels. The US Dollar gained upward traction after Wall Street’s opening, while stocks recover following one of the worst weeks of the year.

Optimism seems to be benefiting the American currency despite political noise from the weekend. President Joe Biden decided to step down from the presidential race, which ended up boosting hopes for a Donald Trump victory, known for being more “pro-market.”

Meanwhile, upcoming United States (US) first-tier figures maintain investors in wait-and-see mode. The country will publish this week the first estimate of the Q2 Gross Domestic Product (GDP), alongside a revision of the Fed’s favorite inflation gauge for the first quarter, the Personal Consumption Expenditures (PCE) Price Index. Additionally, the US will release June PCE inflation on Friday.

XAU/USD short-term technical outlook  

The XAU/USD pair is down for a fourth consecutive day, with the slide decelerating, suggesting the correction may soon be over. The daily chart shows the pair holds above a bullish 20 Simple Moving Average (SMA) which advances above also ascending 100 and 200 SMAs while providing dynamic support at around $2,377.10. Meanwhile, the technical indicators are losing their downward strength within positive levels, near completing the overbought correction.

In hte near term, and according to the 4-hour chart, the risk remains skewed to the downside. XAU/USD trades below a firmly bearish 20 SMA, while pressures a mildly bullish 100 SMA, suggesting continued selling pressure. At the same time technical indicators head south near oversold readings, with no signs of changing course.

Support levels: 2,377.10 2,364.00 2,349.50

Resistance levels: 2,412.10 2,425.70 2,439.90

Currently, the oil market is tight and warrants the $80s per barrel price range, but with seasonal demand starting to abate in the fourth quarter, market balances are set to return, the investment bank said in a note carried by Reuters on Monday.

In the fourth quarter of 2024, the market would be balanced “when seasonal demand tailwinds abate and both OPEC and non-OPEC supply return to growth,” Morgan Stanley’s analysts wrote. 

Next year, the market will even tip into a surplus amid rising supply from both OPEC+ and non-OPEC+ producers, the bank’s commodity strategists reckon.

According to the bank, global refinery runs will hit their 2024 peak in August and are not expected to reach this level again until July next year. 

That’s why Morgan Stanley expects Brent Crude prices to drop from current levels to the mid $70s to high $70s per barrel range in 2025.  

Early on Monday, Brent Crude prices were up by 0.52% at $83.07, while the U.S. benchmark, WTI Crude, was trading 0.49% higher at $80.46.

Morgan Stanley reiterated in the note its price forecast of $86 per barrel Brent oil for the third quarter of 2024.

Goldman Sachs has also recently reaffirmed its outlook from June that

Brent crude prices are set to rise to $86 per barrel this summer amid strong consumer demand which will put the market into a sizeable deficit in the third quarter.

The Joint Ministerial Monitoring Committee (JMMC), the OPEC+ panel monitoring the oil market, is not expected to recommend in August any changes to the current production policy plan of the group, OPEC+ delegates told Bloomberg last week.    

When the panel meets again on August 1, the meeting is expected to be a routine one, and no recommendations on oil production policy – other than the OPEC+ group has already announced – are expected to be issued, according to Bloomberg‘s anonymous sources among the OPEC+ delegates.  

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:

• Gold price bounces off $2,400 amid a positive start to a Big week.
• Despite risk aversion, the US Dollar stays softer with US Treasury bond yields.    
• Gold price looks to $2,425, as the daily RSI turns north above 50.

Gold price is attempting a bounce from $2,400, having snapped a three-day corrective decline from record highs of $2,484. Gold price capitalizes on a broad-based US Dollar softness alongside sluggish US Treasury bond yields even as markets stay risk averse.

Gold price keenly awaits top-tier US economic data

As investors digest the recent US political developments, the US Dollar maintains a weaker undertone so far this Monday. On Sunday, US President Biden dropped out of the election race and endorsed Vice President Kamala Harris for the Democratic ticket. Online betting site PredictIT showed pricing for a victory by Donald Trump had fallen 4 cents to 60 cents, while Harris climbed 12 cents to 39 cents, per Reuters.

A Democratic win would imply higher taxes and the need for lower borrowing costs, suggesting that policy easing for the US Federal Reserve (Fed). This, in turn, would be bearish for the US Dollar in the long term. Therefore, the Greenback is unable to take advantage of the market’s anxiety amid renewed China growth worries while gearing up for key US event risks later this week.

The US equity and Treasury futures rise, exerting negative pressure on the US Treasury bond yields across the curve, lending additional support to the non-yielding Gold price. Markets also seem to ignore the People’s Bank of China’s (PBOC) interest-rate cuts to its one-year and five-year mortgage lending rates, as it raises concerns that the government recognizes the downward pressure on China’s economy.

Markets also stay unnerved as a packed week of corporate earnings unfolds, with Tesla and Google-parent Alphabet due on the cards. Additionally, traders resort to repositioning ahead of Thursday’s advance US second-quarter Gross Domestic Product (GDP) and the Fed favored inflation gauge out on Friday. 

Markets are currently pricing in a September rate cut, as futures show a 97% chance, according to the CME Group’s FedWatch Tool.

Ahead of these key events, Gold price could maintain a buoyant tone amid dovish Fed expectations and the US political uncertainty. However, the fading Asian physical demand for Gold price could act as a headwind for the bright metal. Asian customers, especially the Indians, refrained from making new purchases despite deep discounts, as they preferred to book profits on record-high bullion prices.

China, dealers were offering discounts of up to $6 an ounce on international spot prices, the lowest in more than two years as per Reuters records.

Gold price technical analysis: Daily chart

Gold price has found fresh buyers, as the 14-day Relative Strength Index (RSI) stalls its descent and turns north again while holding above the 50 level. The indicator is currently at 55.

The 21-day  and 50-day Simple Moving Averages (SMA) Bull Cross also remains in play, adding credence to the renewed upside in Gold price.

if Gold price rebound picks up strength, the $2,425 static resistance will be tested. The next topside barrier is seen at the previous lifetime high of $2,450, above which buyers will target the new all-time high of $2,484 reached last week.

Conversely, should sellers fight back control, Gold price could challenge the $2,400 threshold once again. Acceptance below that level could accentuate the downside toward the 21-day SMA at $2,376.

Additional weakness could expose the 50-day SMA support at $2,360.

• Gold price bounces off $2,400 amid a positive start to a Big week.
• Despite risk aversion, the US Dollar stays softer with US Treasury bond yields.    
• Gold price looks to $2,425, as the daily RSI turns north above 50.

Gold price is attempting a bounce from $2,400, having snapped a three-day corrective decline from record highs of $2,484. Gold price capitalizes on a broad-based US Dollar softness alongside sluggish US Treasury bond yields even as markets stay risk averse.

Gold price keenly awaits top-tier US economic data

As investors digest the recent US political developments, the US Dollar maintains a weaker undertone so far this Monday. On Sunday, US President Biden dropped out of the election race and endorsed Vice President Kamala Harris for the Democratic ticket. Online betting site PredictIT showed pricing for a victory by Donald Trump had fallen 4 cents to 60 cents, while Harris climbed 12 cents to 39 cents, per Reuters.

A Democratic win would imply higher taxes and the need for lower borrowing costs, suggesting that policy easing for the US Federal Reserve (Fed). This, in turn, would be bearish for the US Dollar in the long term. Therefore, the Greenback is unable to take advantage of the market’s anxiety amid renewed China growth worries while gearing up for key US event risks later this week.

The US equity and Treasury futures rise, exerting negative pressure on the US Treasury bond yields across the curve, lending additional support to the non-yielding Gold price. Markets also seem to ignore the People’s Bank of China’s (PBOC) interest-rate cuts to its one-year and five-year mortgage lending rates, as it raises concerns that the government recognizes the downward pressure on China’s economy.

Markets also stay unnerved as a packed week of corporate earnings unfolds, with Tesla and Google-parent Alphabet due on the cards. Additionally, traders resort to repositioning ahead of Thursday’s advance US second-quarter Gross Domestic Product (GDP) and the Fed favored inflation gauge out on Friday. 

Markets are currently pricing in a September rate cut, as futures show a 97% chance, according to the CME Group’s FedWatch Tool.

Ahead of these key events, Gold price could maintain a buoyant tone amid dovish Fed expectations and the US political uncertainty. However, the fading Asian physical demand for Gold price could act as a headwind for the bright metal. Asian customers, especially the Indians, refrained from making new purchases despite deep discounts, as they preferred to book profits on record-high bullion prices.

China, dealers were offering discounts of up to $6 an ounce on international spot prices, the lowest in more than two years as per Reuters records.

Gold price technical analysis: Daily chart

Gold price has found fresh buyers, as the 14-day Relative Strength Index (RSI) stalls its descent and turns north again while holding above the 50 level. The indicator is currently at 55.

The 21-day  and 50-day Simple Moving Averages (SMA) Bull Cross also remains in play, adding credence to the renewed upside in Gold price.

if Gold price rebound picks up strength, the $2,425 static resistance will be tested. The next topside barrier is seen at the previous lifetime high of $2,450, above which buyers will target the new all-time high of $2,484 reached last week.

Conversely, should sellers fight back control, Gold price could challenge the $2,400 threshold once again. Acceptance below that level could accentuate the downside toward the 21-day SMA at $2,376.

Additional weakness could expose the 50-day SMA support at $2,360.

• Gold price extends correction from all-time highs of $2,484, paring weekly gains early Friday.
• The US Dollar rebounds firmly with US Treasury bond yields amid risk-aversion and Fed uncertainty.    
• Gold buyers stay hopedul as the daily RSI still holds above 50, ‘buy the dips’?

Gold price is on a three-day corrective decline from record highs of $2,484 on Friday, paring back weekly gains amid a solid rebound staged by the US Dollar (USD) alongside the US Treasury bond yields.  

Gold price consolidates weekly gains ahead of more Fedspeak

The Greenback witnessed a dramatic comeback in the second half of Thursday’s trading after risk-aversion gripped markets, as Wall Street traders remained wary, rotating away from high-priced megacap growth stocks amid second-quarter earnings season.

Escalating trade tensions between the US and China combined with uncertainty on whether the US Federal Reserve (Fed) will go for another interest-rate cut after lowering rates in September weighed on the market sentiment, lifting the US Treasury bond yields across the curve. This, in turn, propelled the US Dollar from four-month troughs against its major currency rivals.

Markets are fully pricing in the September Fed rate cut while another cut in December is also likely, according to the CME Group’s FedWAtch Tool.

San Francisco Fed President Mary Daly participated in a ‘fireside chat’ at a conference late Thursday, noting that she is looking for more confidence that inflation is moving back to the Fed’s 2% target before calling for an interest rate cut.

Meanwhile, data on Thursday showed that US jobless claims rose to the highest level in nearly a year to a seasonally adjusted 243,000 for the week ended July 13. On the other hand, The Philly Fed Manufacturing Index jumped from 1.3 in June to an impressive 13.9 in July, reaching its highest point since April and smashing the 2.9 forecast. Mixed US economic data combined with prudent Fed commentary raised concerns on the scope of the Fed rate cuts this year.

Looking ahead, all eyes will remain on the speeches from the Fed officials, as the US central bank enters its ‘blackout period’ on Saturday before July 30-31 policy meeting. Fed policymakers John Williams and Raphael Bostic are due to speak later in the American session on Friday.  

Also, Gold traders will stay cautious, as the end-of-the-week flows will remain in play and position readjustments ahead of next week’s advance US Gross Domestic Product (GDP) data for the second quarter.

Gold price technical analysis: Daily chart

Despite the recent retracement, the bullish bias for Gold price remains intact so long as the 14-day Relative Strength Index (RSI) remains above the 50 level. The indicator is currently at 60.

The previous week’s 21-day  and 50-day Simple Moving Averages (SMA) Bull Cross also continues to lean in favor of Gold buyers.

The immediate support for Gold price is seen at the previous week’s high of $2,425. A sustained move below that level could accentuate the downside toward the 21-day SMA at $2,373.

Ahead of that, the $2,400 mark could come into play.

On the flip side, if Gold price resumes its uptrend, the previous lifetime high at $2,450 will be put to the test, above which the new all-time high of $2,484 will be challenged en route the $2,500 barrier.  

• Gold price extends correction from all-time highs of $2,484, paring weekly gains early Friday.
• The US Dollar rebounds firmly with US Treasury bond yields amid risk-aversion and Fed uncertainty.    
• Gold buyers stay hopedul as the daily RSI still holds above 50, ‘buy the dips’?

Gold price is on a three-day corrective decline from record highs of $2,484 on Friday, paring back weekly gains amid a solid rebound staged by the US Dollar (USD) alongside the US Treasury bond yields.  

Gold price consolidates weekly gains ahead of more Fedspeak

The Greenback witnessed a dramatic comeback in the second half of Thursday’s trading after risk-aversion gripped markets, as Wall Street traders remained wary, rotating away from high-priced megacap growth stocks amid second-quarter earnings season.

Escalating trade tensions between the US and China combined with uncertainty on whether the US Federal Reserve (Fed) will go for another interest-rate cut after lowering rates in September weighed on the market sentiment, lifting the US Treasury bond yields across the curve. This, in turn, propelled the US Dollar from four-month troughs against its major currency rivals.

Markets are fully pricing in the September Fed rate cut while another cut in December is also likely, according to the CME Group’s FedWAtch Tool.

San Francisco Fed President Mary Daly participated in a ‘fireside chat’ at a conference late Thursday, noting that she is looking for more confidence that inflation is moving back to the Fed’s 2% target before calling for an interest rate cut.

Meanwhile, data on Thursday showed that US jobless claims rose to the highest level in nearly a year to a seasonally adjusted 243,000 for the week ended July 13. On the other hand, The Philly Fed Manufacturing Index jumped from 1.3 in June to an impressive 13.9 in July, reaching its highest point since April and smashing the 2.9 forecast. Mixed US economic data combined with prudent Fed commentary raised concerns on the scope of the Fed rate cuts this year.

Looking ahead, all eyes will remain on the speeches from the Fed officials, as the US central bank enters its ‘blackout period’ on Saturday before July 30-31 policy meeting. Fed policymakers John Williams and Raphael Bostic are due to speak later in the American session on Friday.  

Also, Gold traders will stay cautious, as the end-of-the-week flows will remain in play and position readjustments ahead of next week’s advance US Gross Domestic Product (GDP) data for the second quarter.

Gold price technical analysis: Daily chart

Despite the recent retracement, the bullish bias for Gold price remains intact so long as the 14-day Relative Strength Index (RSI) remains above the 50 level. The indicator is currently at 60.

The previous week’s 21-day  and 50-day Simple Moving Averages (SMA) Bull Cross also continues to lean in favor of Gold buyers.

The immediate support for Gold price is seen at the previous week’s high of $2,425. A sustained move below that level could accentuate the downside toward the 21-day SMA at $2,373.

Ahead of that, the $2,400 mark could come into play.

On the flip side, if Gold price resumes its uptrend, the previous lifetime high at $2,450 will be put to the test, above which the new all-time high of $2,484 will be challenged en route the $2,500 barrier.