Gold retakes $5,000 early Friday amid a turnaround from weekly lows as US CPI data loom.
The US Dollar consolidates weekly losses as AI concerns-driven risk-off mood stalls downside.
Technically, Gold appears primed for a big range breakout, with risks skewed toward a bullish break.
Gold is staging a comeback toward $5,000 early Friday, reversing a part of Thursday’s 3.5% sell-off. The focus now remains on the all-important US CPI release for the next big move in Gold.
Gold is back on the bids, continuing to find bargain hunters at lower levels as geopolitical tensions and US Federal Reserve interest rate cut expectations remain in play.
Despite a positive surprise in the January Nonfarm Payrolls data, markets still price in atleast two Fed rate cuts this year, according to the CME Group’s FedWatch Tool.Therefore, the major US CPI data remains critical in gauging whether the Fed will conform to the market expectations or lean hawkish if inflation picks up in January.
The US core annual CPI is seen easing to 2.5% in January from December’s 2.6% print. The core monthly CPI is expected to rise by 0.3% in the same period against a 0.2% increase in December. Meanwhile, the headline annual CPI inflation is also likely to soften to 2.5%.
A hotter-than-expected core annual and monthly CPI readings could pour cold water on bets for two Fed rate cuts this year, fuelling a sustained USD recovery at the expense of non-yielding assets such as Gold.
Markets brace for intense volatility on the US CPI release this Friday, with a sense of caution reviving Gold buyers in the lead-up to the critical event risk.
Gold tumbled close to 3.5% on Thursday as an intense selling wave gripped markets and unexpectedly ramped up haven demand for the USD. Concerns around AI driven disruption resurfaced, this time spreading to the commercial property space.
Real estate stocks were the latest sector to come under pressure following earlier sell-offs in software and financial services tied to AI fears, per CNBC News.
Daily technical analysis
The 21-day Simple Moving Average (SMA) rises above the 50-, 100-, and 200-day SMAs, underscoring bullish alignment. All SMAs trend higher while price holds above them, keeping buyers in control. The 21-day SMA currently stands at $4,952.03 and offers nearby dynamic support. The Relative Strength Index (RSI) sits at 54.80 (neutral) and is edging higher, reinforcing a steady bid.
Measured from the $5,597.89 high to the $4,401.99 low, the Fibonacci retracement framework points to overhead barriers on rebounds. The 50% retracement at $4,999.94 caps initial advances, with the 61.8% at $5,141.05 as the next resistance. A sustained push above the former would open room toward the latter, while rejection keeps the upside constrained and leaves the focus on nearby moving average support.
Will US CPI data trigger a GOLD range breakout?
Gold is staging a comeback toward $5,000 early Friday, reversing a part of Thursday’s 3.5% sell-off. The focus now remains on the all-important US CPI release for the next big move in Gold.
Gold is back on the bids, continuing to find bargain hunters at lower levels as geopolitical tensions and US Federal Reserve interest rate cut expectations remain in play.
Despite a positive surprise in the January Nonfarm Payrolls data, markets still price in atleast two Fed rate cuts this year, according to the CME Group’s FedWatch Tool.Therefore, the major US CPI data remains critical in gauging whether the Fed will conform to the market expectations or lean hawkish if inflation picks up in January.
The US core annual CPI is seen easing to 2.5% in January from December’s 2.6% print. The core monthly CPI is expected to rise by 0.3% in the same period against a 0.2% increase in December. Meanwhile, the headline annual CPI inflation is also likely to soften to 2.5%.
A hotter-than-expected core annual and monthly CPI readings could pour cold water on bets for two Fed rate cuts this year, fuelling a sustained USD recovery at the expense of non-yielding assets such as Gold.
Markets brace for intense volatility on the US CPI release this Friday, with a sense of caution reviving Gold buyers in the lead-up to the critical event risk.
Gold tumbled close to 3.5% on Thursday as an intense selling wave gripped markets and unexpectedly ramped up haven demand for the USD. Concerns around AI driven disruption resurfaced, this time spreading to the commercial property space.
Real estate stocks were the latest sector to come under pressure following earlier sell-offs in software and financial services tied to AI fears, per CNBC News.
Daily technical analysis
The 21-day Simple Moving Average (SMA) rises above the 50-, 100-, and 200-day SMAs, underscoring bullish alignment. All SMAs trend higher while price holds above them, keeping buyers in control. The 21-day SMA currently stands at $4,952.03 and offers nearby dynamic support. The Relative Strength Index (RSI) sits at 54.80 (neutral) and is edging higher, reinforcing a steady bid.
Measured from the $5,597.89 high to the $4,401.99 low, the Fibonacci retracement framework points to overhead barriers on rebounds. The 50% retracement at $4,999.94 caps initial advances, with the 61.8% at $5,141.05 as the next resistance. A sustained push above the former would open room toward the latter, while rejection keeps the upside constrained and leaves the focus on nearby moving average support.
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