- The XAU/USD remains bullish ahead of the US data.
- The FOMC represents a high-impact event.
- The upper median line (uml) of the descending pitchfork represents a major target.
The gold price rallied in the last trading session, reaching the fresh daily highs above $1,930.
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Now, the precious metal has retreated a little and trading at $1,926. The upside pressure remains high as the USD remains bearish versus its rivals despite temporary appreciations. It could change only a little in the short term ahead of the US data and before the FOMC. The fundamentals should move the price today, so anything could happen.
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The XAU/USD rallied as the US CB Consumer Confidence and Chicago PMI came in worse than expected yesterday. Today, the FOMC represents the most important event and could force the yellow metal to register sharp movements.
The Federal Funds Rate should be increased from 4.50% to 4.75%. The FOMC Press Conference could really shake the price.
Still, don’t forget that the US is to release the JOLTS Job Openings, ISM Manufacturing PMI, and ADP Non-Farm Employment Change. These are seen as high impact events, so worse than expected data could lift the yellow metal.
Actually, the economic indicators are expected to come in worse compared to the previous reporting period, probability that’s why the XAU/USD remains bullish.
Furthermore, tomorrow, we’ll have the ECB and the ECB Press Conference as major events. The European Central Bank is expected to deliver a 50 bps hike in the February meeting.
On Friday, the NFP, ISM Services PMI, Average Hourly Earnings, and Unemployment Rate data should move the price.
Gold price technical analysis: Turning down
Technically, the price found strong demand above the $1,900 psychological level. It has jumped above the median line (ml) and now it challenges the upside 50% Fibonacci line which stands as a dynamic resistance.
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After its strong rally, a minor retreat was natural. The $1,931 yesterday’s high represents a static resistance. A new higher high activates further growth at least towards the former highs. The upper median line (uml) of the descending pitchfork represents a major upside target.
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