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Gold Forecast: XAU/USD advances strongly, hovering around $1,750 on strong US data.

  • On Friday, gold is up nearly 0.40%, but is still down 3.53% on the week.
  • The shiny metal regained some of its shine due to a weaker US dollar and mixed sentiment.
  • Gold Price Forecast (XAUUSD): A Falling Wedge Suggests Upside Pressure Might Be Building But Buyers Need To Reclaim $1,773; otherwise, gold can fall towards $1,700.

Gold (XAUUSD) rises during the American session, bouncing from new all-time lows around $1,720, aiming to break above $1,750 as the US dollar weakens overall. At the time of writing, XAUUSD is trading at $1,744.27.

The yellow metal recovers from weekly lows thanks to the weakness of the dollar

Sentiment remains fragile and fluctuates based on an upbeat US jobs report. The US Department of Labor reported that June nonfarm payrolls increased by 372,000, beating estimates of 268,000, while the previous reading was revised down to 384,000. This clears the way for the Federal Reserve to further tighten its monetary policy. At the time of writing, STIR money market futures odds of a 75 basis point rise in the Federal Funds Rate (FFR) stand at 97%, while investors expect a 50 basis points for the September meeting.

Reflecting the above, US equities are mixed. Meanwhile, the greenback erases earlier gains after hitting a new yearly high, slipping below the 107,000 mark, down 0.07%, while the 10-year US Treasury yield rises. six basis points, with a yield of 3,063%.

Recession fears continue to be fueled by the inversion of the US 2yr-10yr yield curve to -0.021% from -0.03% around 14:15GMT.

Fed speakers will continue to cross the news wires, led by New York Fed President John Williams. However, Atlanta Fed President Raphael Bostic said the US jobs report shows the economy is strong, and he supports a 75 basis point rate hike. On Thursday, the Fed’s 2022 FOMC voters, Christopher Waller and James Bullard, said they favor a 75 basis point rate hike in July, downplaying recession fears, saying the US economy remains being solid.

What to watch out for

In the coming week, the US economic agenda will feature more speakers from the Fed before entering the blocking period of the July monetary policy meeting. Fed regional presidents Williams, Barkin and Bostic will speak on Monday, Tuesday and Friday, respectively. Meanwhile, Christopher Waller will take the stand on Thursday.

As for the data, June’s consumer price index (CPI), producer price index (PPI) and consumer sentiment from the University of Michigan (UoM) will shed some light on the state of the economy. American.

Gold Price Forecast (XAUUSD): Technical Outlook

Gold’s daily chart shows a falling wedge forming, suggesting that the yellow metal could turn bullish in the short term. Oscillators are in oversold condition though, with the RSI at 28.70 far from supporting a bullish bias, but once it breaks out of that zone, gold could consolidate before challenging the upper trend line of the rising wedge around of $1,800.

Technical levels

XAU/USD

Panorama
Last Price Today 1742.47
Today’s Daily Change 2.17
Today’s Daily Change % 0.12
Today’s Daily Opening 1740.3
Trends
20 Daily SMA 1815.8
50 Daily SMA 1836.83
100 Daily SMA 1887.48
200 Daily SMA 1845.91
levels
Previous Daily High 1749.07
Previous Daily Minimum 1736.55
Previous Maximum Weekly 1841.05
Previous Weekly Minimum 1784.55
Monthly Prior Maximum 1879.26
Previous Monthly Minimum 1802.79
Daily Fibonacci 38.2% 1744.29
Daily Fibonacci 61.8% 1741.33
Daily Pivot Point S1 1734.88
Daily Pivot Point S2 1729.45
Daily Pivot Point S3 1722.36
Daily Pivot Point R1 1747.4
Daily Pivot Point R2 1754.49
Daily Pivot Point R3 1759.92

Source: Fx Street

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