#XAUUSD @ 1,943.45 US economic strength shown by the latest round of data raises prospects of a June Fed rate hike, boosting the US Dollar. (Pivot Orderbook analysis)
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- US economic strength shown by the latest round of data raises prospects of a June Fed rate hike, boosting the US Dollar.
- Wall Street climbs despite a rise in Fed’s gauge for inflation, with Core PCE hitting 4.7% YoY.
- Rising US Treasury bond yields and Fed hawkish commentary could hurt Gold’s recovery.
The pair currently trades last at 1943.45.
The previous day high was 1964.82 while the previous day low was 1938.91. The daily 38.2% Fib levels comes at 1948.81, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1954.92, expected to provide resistance.
Gold price recovers some ground but remains shy of reclaiming the $1950 figure after solid economic data in the United States (US) suggests the Federal Reserve (Fed) could opt to hike again in June. Consequently, US Treasury bond yields are rising, while the US Dollar (USD) hits new two-month highs vs. a basket of peers. The XAU/USD is trading at $1940.21, still up by a minuscule 0.03%.
Wall Street registered solid gains, even though the Federal Reserve’s (Fed) preferred gauge for inflation, the Core Personal Consumption Expenditure (PCE), which strips volatile items like food and energy, exceeded estimates of 4.6% and rose by 4.7% YoY in April. Following suit, headline inflation climbed from 4.2% to 4.4% YoY after the Fed released its May meeting minutes, which showed the US central bank’s openness to pause its tightening cycle.
In another data, the final reading of the University of Michigan Consumer Sentiment for May, beat estimates of 57.7 at 59.2 but trailed the 63.5 prior’s reading. The same poll revealed that American citizens’ inflation expectations for one year eased from 4.5% to 4.1% by year’s end, while for a 5-year horizon, they came at 3.1% above April’s 3.0%.
Earlier, Durable Good Orders in April rose by 1.1% MoM, above estimates of a 1% plunge but trailed the staggering March’s 3.3%, indicating that consumer and business spending remains resilient, another reason that justifies Jerome Powell and Co. to continue to lift rates, as the economy opposes resistance to higher interest rates.
Consequently, US Treasury bond yields continued to rise, with the 10-year benchmark note rate at 3.851%, its highest level since March 10, putting a lid on Gold recovery. Another factor that could dent appetite for XAU/USD is US real yields, which stand at 1.60%, higher than Thursday’s close of 1.57%.
Recently, the Cleveland Fed President Loretta Mester stood to her hawkish stance and confirmed that inflation is too high in an interview on CNBC. She said that she would revise up her forecast for inflation and that more data would help her to decide on the June meeting while emphasizing that “everything is on the table” for the next FOMC.
XAU/USD is neutral to downward biased, though it remains trading within the boundaries of important support and resistance levels. As support, the 100-day Exponential Moving Average (EMA) at $1933.85 keeps cushioning God’s fall while the psychological price level of $1950 keeps price action restricted in a $17 range. If XAU/USD sellers claim the former, that could open the door to test the $1900 figure before threatening the 200-day EMA at $1883.27. On the other hand, if XAU/USD buyers conquer the $1950 figure, the yellow metal could be on its way to challenge the $1973.32 area, where the 50-day EMA rests.
Technical Levels: Supports and Resistances
XAUUSD currently trading at 1942.25 at the time of writing. Pair opened at 1941.37 and is trading with a change of 0.05 % .
| Overview | Overview.1 | |
|---|---|---|
| 0 | Today last price | 1942.25 |
| 1 | Today Daily Change | 0.88 |
| 2 | Today Daily Change % | 0.05 |
| 3 | Today daily open | 1941.37 |
The pair is trading below its 20 Daily moving average @ 1998.76, below its 50 Daily moving average @ 1992.47 , above its 100 Daily moving average @ 1933.96 and above its 200 Daily moving average @ 1829.49
| Trends | Trends.1 | |
|---|---|---|
| 0 | Daily SMA20 | 1998.76 |
| 1 | Daily SMA50 | 1992.47 |
| 2 | Daily SMA100 | 1933.96 |
| 3 | Daily SMA200 | 1829.49 |
The previous day high was 1964.82 while the previous day low was 1938.91. The daily 38.2% Fib levels comes at 1948.81, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1954.92, expected to provide resistance.
Note the levels of interest below:
- Pivot support is noted at 1931.91, 1922.46, 1906.0
- Pivot resistance is noted at 1957.82, 1974.28, 1983.73
| Levels | Levels.1 |
|---|---|
| Previous Daily High | 1964.82 |
| Previous Daily Low | 1938.91 |
| Previous Weekly High | 2022.18 |
| Previous Weekly Low | 1952.01 |
| Previous Monthly High | 2048.75 |
| Previous Monthly Low | 1949.83 |
| Daily Fibonacci 38.2% | 1948.81 |
| Daily Fibonacci 61.8% | 1954.92 |
| Daily Pivot Point S1 | 1931.91 |
| Daily Pivot Point S2 | 1922.46 |
| Daily Pivot Point S3 | 1906.00 |
| Daily Pivot Point R1 | 1957.82 |
| Daily Pivot Point R2 | 1974.28 |
| Daily Pivot Point R3 | 1983.73 |
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