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. With extensive experience in market analysis and a strong foundation in international relations, he brings a unique perspective to financial markets. Nikos emphasizes not only technical analysis but also on fundamentals and the growing influence of geopolitics on financial trends.
As a Senior Financial Editorial Writer, he delivers comprehensive and forward-looking insights across a wide range of asset classes, including equities, commodities, and currencies. His work explores how macroeconomic events, political developments, and global policies impact market dynamics, providing readers with a deeper understanding of both short-term movements and long-term trends.
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