Gold prices consolidate recent gains amid a quiet Asian session.Inflation fears underpin the US dollar’s corrective pullback from monthly low after two-week downtrend.
Hopes of firmer US employment figures, technical barriers also challenge bulls.
Gold Weekly Forecast: Sellers stay on the sidelines as focus shifts to US data
Gold (XAU/USD) licks its wounds around $1,850, following a two-week rebound, as the US Dollar Index (DXY) pauses the latest pullback amid a sluggish Asian session on Monday.
That said, the US Dollar Index (DXY) prints 0.05% intraday gains around 101.68, bouncing off the monthly low of 101.43 flashed on Friday, as markets reassert Friday’s US data to forecast the Fed’s next moves.
On Friday, the US Personal Consumption Expenditure (PCE) data came in mixed for April, mostly downbeat, as the Core PCE Price Index, the Fed’s preferred measure of inflation, matched 4.9% YoY forecasts versus 5.2% prior. Further, Personal Income rose less than expected but the Personal Spending improved.
Following the data, traders cheered mixed data with a rush towards riskier assets and propelled the Wall Street benchmarks but kept the bond yields intact. It’s worth noting that the S&P 500 Future print mild gains but the US 10-year Treasury yields stay unchanged at 2.74% amid the US bank holiday.
Moving on, a light calendar and a bank holiday in the US may restrict gold’s immediate moves. However, risk catalysts will be important to watch for fresh impulse, which in turn highlight headlines from Russia and China.
Above all, this week’s US jobs report for April may also help the greenback gauge to pare the latest losses, amid hopes of firmer prints, which in turn could weigh on gold prices.
Gold’s pullback from a two-week-old previous support line, around $1,865 by the press time, needs validation from the $1,845 support confluence, including the 50-SMA and 100-SMA. That said, the MACD flashes the bearish signals while the RSI remains downwardly sloped, not oversold, which in turn suggests room for further downside.
EUR/USD holds on to gains around 1.0770
The EUR/USD pair trades near a fresh May monthly high of 1.0780, despite German inflation soaring to a multi-decade high of 7.9% in the month. US markets will remain closed on Monday, but action is granted throughout the week.
GBP/USD trades below 1.2650, paring some of its gains
GBP/USD is trading below 1.2650, paring back gains despite the risk-on market mood. The US dollar remains on the back foot alongside the yields amid easing hopes for aggressive Fed tightening later this year. Liquidity is thinner due to a US holiday.
Gold is stuck between familiar levels
Gold Price is down on Monday, trading at around $1,855. Market participants are still dropping safe-haven assets to the benefit of high-yielding ones. XAUUSD is stuck between familiar levels, but the risk is skewed to the upside.
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