Gold Recovery Stalls as Critical Technical Levels & Upcoming US Inflation Figures Create Caution


XAU/USD Analysis

The precious metal runs a noteworthy four-week recovery, trying to end its four-month losing streak, as the US Dollar rally has paused. It has covered more than half of its June High/July Low plunge and has registered a series of higher high during the current month.

This gives it the chance to try to enter into the daily Ichimoku Cloud, with the lower border seen in the 1,804-1,807 region. However, the technical landscape has become tougher and a strong catalyst will be required for a break above the upper border and the 200Days EMA (at around 1,827), which would bring 1,880 in the spotlight.

Despite the solid rebound and the recent higher highs, the Relative Strength Index (RSI) has been diverging lower, something that could potentially mark the end of Gold's recovery. Today, XAU/USD is soft and this creates risk for a return below the EMA200 and towards 1,754, that would pause the upside momentum. A steeper decline that would challenge 1,711-0 though, has a higher degree of difficulty in the short term.

In any case, the next leg of the move, will likely be determined by today's US inflation report, which can spur volatility and weigh on the Fed's tightening path.

Nikos Tzabouras

Senior Financial Editorial Writer

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

${} / ${getInstrumentData.ticker} /

Exchange: ${}

${} ${getInstrumentData.divCcy} ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%) ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%)

${getInstrumentData.oneYearLow} 52/wk Range ${getInstrumentData.oneYearHigh}

Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.

Past Performance: Past Performance is not an indicator of future results.

Spreads Widget: When static spreads are displayed, the figures reflect a time-stamped snapshot as of when the market closes. Spreads are variable and are subject to delay. Single Share prices are subject to a 15 minute delay. The spread figures are for informational purposes only. FXCM is not liable for errors, omissions or delays, or for actions relying on this information.