The price of gold has risen after rebounding from the lowest point it has been in three months. However, @nehcap predicts that there will be more potential for a decrease in value. #XAUUSD currently stands at 1,957.95.

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for FREE REGISTER to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level1)]

• Gold Price grinds higher after bouncing off the lowest level in three months.

The pair currently trades last at 1957.95.

The previous day high was 1960.33 while the previous day low was 1939.75. The daily 38.2% Fib levels comes at 1947.61, expected to provide support. Similarly, the daily 61.8% fib level is at 1952.47, expected to provide support.

Gold Price (XAU/USD) dribbles near $1,958-59 during early Friday after a volatile day that initially refreshed a multi-day low before bouncing off $1,924, as well as posted snapping the four-day losing streak. That said, the XAU/USD previously dropped to the three-month low as the US Dollar licked Federal Reserve (Fed) inflicted wounds amid hopes of a July rate hike before cheering the USD weakness on downbeat data and the market’s cautious optimism to recover from the lowest level since March.

Gold Price portrayed a perfect contrasting play with the US Dollar as the XAU/USD initially refreshed the monthly low on the greenback’s recovery amid hopes of a July rate hike from the Federal Reserve (Fed) before downbeat US data weighed on the yields and the USD.

That said, the US central bank kept the benchmark interest rate unchanged at 5.0-5.25%, matching market expectations of pausing the multi-month-old hawkish cycle after 10 consecutive rate increases. However, the upbeat FOMC Economic Projections and Federal Reserve (Fed) Chairman Jerome Powell’s speech backed the hawkish Fed bias surrounding the July meeting and weighed on the Gold Price on early Thursday, before bouncing off $1,924.

On the other hand, Thursday’s United States statistics haven’t been impressive and hence pushed back the July rate hike concerns, which in turn joined other risk-positive catalysts to weigh on the US Dollar and propel the Gold Price.

On Thursday, US Retail Sales growth marks an increase of 0.3% for May versus -0.1% expected and 0.4% previous readings while the Core readings, means Retail Sales ex Autos, match 0.1% market forecasts for the said month, compared to 0.4% prior.

Further, NY Fed Empire State Manufacturing Index jumps to 6.6 in June versus -15.1 expected and -31.8 prior whereas Philadelphia Fed Manufacturing Index drops to -13.7 for the said month from -10.4 prior and compared to -14 market forecasts.

Additionally, US Industrial Production for May cools down to -0.2% against 0.1% estimated and 0.5% prior while Initial Jobless Claims reprints the upwardly revised figures of 262K for the week ended on June 09 versus 249K expected.

Apart from the US data, the European Central Bank’s (ECB) 25 basis points (bps) interest rate hike and clues of more such moves ahead also weighed on the US Dollar.

Elsewhere, the People’s Bank of China (PBoC) cut its one-year interest rate for the first time in 10 months, by 10 basis points (bps), which in turn unleashed hopes of more liquidity in one of the world’s biggest Gold consumer and favor the metal price. It should be noted that downbeat prints of China Retail Sales and Industrial Production and fears of labor problems in Beijing-based factories prod the XAU/USD bulls.

Amid these plays, market players portrayed an optimistic day with upbeat Wall Street performance and a steep fall in the US Treasury bond yields, not to forget the US Dollar Index (DXY) drop to the three-week low. The same offered the Gold Price the much-needed rebound to pare weekly losses inside a bullish chart pattern.

Although the latest United States data have been helpful to push back the concerns about the Federal Reserve’s (Fed) July rate increase, the CME’s FedWatch Tool still shows around a 67% chance of the US central bank’s 0.25% rate hike in the next month. Hence, more data rejecting the hawkish bias needs to defend the latest Gold Price rebound.

As a result, today’s preliminary readings of the Michigan Consumer Sentiment Index (CSI) for June and five-year inflation expectations will be in the spotlight. Also important to watch will be the US Treasury bond yields and the US Dollar moves.

Also read: Gold Price Forecast: XAU/USD could well rally on any data showing inflation pressures are easing – TDS

Gold Price fades upside momentum within a fortnight-old falling wedge bullish chart formation.

Adding strength to the XAU/USD recovery hopes is the looming bull cross on the Moving Average Convergence and Divergence (MACD) indicator, as well as a U-turn by the Relative Strength Index (RSI) line, placed at 14, from the oversold territory.

It’s worth noting, however, that the 200-bar Exponential Moving Average (EMA) adds strength to the wedge’s top line and makes it harder to cross the $1,968 hurdle.

Also challenging the Gold Price upside is a one-month-old horizontal resistance zone surrounding $1,983-87.

Meanwhile, the stated bullish chart pattern’s lower line, close to $1,923 at the latest, precedes the mid-March consolidation around $1,910-15 to challenge the short-term XAU/USD downside.

Following that, the Gold Price downside towards the $1,900 threshold, $1,890 dynamic support and the early March swing high of near $1,858 will be on the XAU/USD bear’s radar.

Trend: Further downside expected

Technical Levels: Supports and Resistances

XAUUSD currently trading at 1957.79 at the time of writing. Pair opened at 1942.49 and is trading with a change of 0.79% % .

The pair is trading above its 20 Daily moving average @ 1957.77, below its 50 Daily moving average @ 1987.58 , above its 100 Daily moving average @ 1941.68 and above its 200 Daily moving average @ 1845.19

The previous day high was 1960.33 while the previous day low was 1939.75. The daily 38.2% Fib levels comes at 1947.61, expected to provide support. Similarly, the daily 61.8% fib level is at 1952.47, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1934.72, 1926.94, 1914.14
• Pivot resistance is noted at 1955.3, 1968.1, 1975.88

[/s2If]
Nehcap Expert Advisor
The NEHCAP MT4 EA is high quality professional trading system geared to generate returns without using GRID or martingales. Each trade has strict risk per trade parameter. The pairs under management include EURUSD, GBPUSD, AUDCAD, AUDNZD,GBPAUD, EURAUD, EURCAD, CHFJPY and many more.
The system is trading live: LIVE ACCOUNT TRACKING
You can run it free. Apply for a free trial and track our account. Buy the system or use profit share mechanism to generate returns on your MT4.
Join Our Telegram Group