Strong economic activity in the United States is supporting the #dollar, and that's why we are witnessing a decline in the #price of an ounce of gold. #Gold prices seem unable to initiate a rally or a significant drop; in fact, the market is in a #range.
#Fundamental Analysis of #Gold
It is expected that #economic data in the coming week will support the scenario of no change in interest rates at the September Federal Reserve meeting and may even keep the central bank from adjusting interest rates until the end of 2023.
However, this week, the market's focus will be on the European Central Bank's interest rate decision. It is expected that the central bank will not make any changes to interest rates, not because of inflationary pressures but due to the threat of an economic recession in the Eurozone.
#GoldForecast
In the coming week, the interest rate in the Eurozone is not expected to change significantly, and as a result, its impact on the US #dollar and the price of an ounce of #gold will be limited. However, it is expected that the European Central Bank will not reduce interest rates for a long time. If the European Central Bank expresses concerns about the #future of the Eurozone economy, demand for the US #dollar will increase, and in that case, the price of an ounce of #gold will decrease.
Based on this, it is predicted that the short-term trend of an ounce of gold will be inclined towards a decline. The strength of the US dollar will limit any upward rally in the gold market.
#Fundamental Analysis of #Gold
It is expected that #economic data in the coming week will support the scenario of no change in interest rates at the September Federal Reserve meeting and may even keep the central bank from adjusting interest rates until the end of 2023.
However, this week, the market's focus will be on the European Central Bank's interest rate decision. It is expected that the central bank will not make any changes to interest rates, not because of inflationary pressures but due to the threat of an economic recession in the Eurozone.
#GoldForecast
In the coming week, the interest rate in the Eurozone is not expected to change significantly, and as a result, its impact on the US #dollar and the price of an ounce of #gold will be limited. However, it is expected that the European Central Bank will not reduce interest rates for a long time. If the European Central Bank expresses concerns about the #future of the Eurozone economy, demand for the US #dollar will increase, and in that case, the price of an ounce of #gold will decrease.
Based on this, it is predicted that the short-term trend of an ounce of gold will be inclined towards a decline. The strength of the US dollar will limit any upward rally in the gold market.
Trade active:
In the XAUUSD daily chart, the overall market trend is bearish and corrective. However, it is expected that the price will first reach the first resistance at $1931.97 and then return towards the first support at $1913.49. With the break of the first support level, the second support at $1901.55 will be the next market target.
However, if the gold ounce crosses above the first resistance at $1931.97, we may witness an increase in the gold price towards the second resistance at $1943.88, which aligns well with the Fibonacci level.
However, if the gold ounce crosses above the first resistance at $1931.97, we may witness an increase in the gold price towards the second resistance at $1943.88, which aligns well with the Fibonacci level.
1. **Sean Lusk, Walsh Trading:** Lusk believes that the performance of gold is closely tied to fluctuations in the U.S. dollar index. He doesn't anticipate a significant weakening of the U.S. dollar in the near future. While the U.S. stock market is experiencing downward fluctuations, the U.S. dollar has remained relatively strong. Lusk sees a long-term upward trend for gold but notes that the medium-term and technical outlook is less exciting. He suggests that gold sellers may enter the market during upward rallies.
2. **Colin Cieszynski, SIA Capital Management:** Cieszynski sees a bullish trend for gold in the coming week, supported by technical indicators. Gold prices are currently above the 20-day moving average, and oscillators suggest strong buying pressure. He anticipates an upward move in gold.
3. **James Stanley, Forex.com:** Stanley suggests that the release of the Consumer Price Index (CPI) and the European Central Bank meeting could influence the gold trend. He sees a bullish trend in gold, especially as it defended the $1,903-$1,910 support range. However, he is cautious about the ECB's stance on interest rates. If the ECB hints at rate hikes, gold could face a downturn.
4. **Marc Chandler, Bannockburn Global Forex:** Chandler believes that gold will move out of its recent range. He expected gold to rise in the previous week but noted that the strengthening U.S. dollar and stable Treasury yields led to a drop in gold prices. He expects the CPI to grow for the second consecutive month, potentially impacting interest rate expectations. Resistance lies near $1,935-$1,940, while breaking below $1,915 could lead to a drop to $1,900-$1,885.
5. **Adam Button, Forexlive.com:** Button suggests that the yield on government bonds is the key driver of gold and equity markets. He notes that recently, rising yields artificially increased gold's volatility, and a reversal in this trend could lead to gold's increase. However, he doesn't foresee buying gold until mid-November when the Federal Reserve decides on its tightening policies.
6. **Daniel Pavilonis, FJO Futures:** Pavilonis believes that interest rates are the primary driver of gold prices. If crude oil prices continue to rise and pressure inflation, the Federal Reserve may increase rates, which could negatively impact gold. He suggests that gold may fluctuate between $1,900 and $2,000 in the upcoming week.
7. **Mark Leibovit, VR Metals/Resource Letter:** Leibovit sees a short-term bearish trend.
8. **Adrian Day, Adrian Day Asset Management:** Day expects gold to increase in the coming week despite the strengthening U.S. dollar, attributing the recent gold price decline to overselling.
9. **Jim Wyckoff, Kitco:** Wyckoff highlights a serious risk of gold price reduction this week, pointing to a neutral to bearish daily chart.
These professionals offer diverse perspectives on gold's outlook, with some anticipating a bullish trend while others remain cautious about potential headwinds, such as central bank actions and economic indicators. It's important to note that market conditions can change rapidly, and individual investors should conduct thorough research and analysis before making investment decisions.