Technical and Fundamental Analysis of Global Gold (XAUUSD)
Updated
Fundamental and technical analysis of global gold (XAUUSD) - April 10, 2024
In the analysis on March 27, we mentioned how global gold has room for further record-breaking. Gold continues to conquer new peaks. On one hand, intensified geopolitical tensions and, on the other hand, demand for the yellow metal as a safe haven, particularly by major global banks, have caused gold to continue its bullish trend. Today, the market is awaiting the results of one of the biggest economic indicators of the month, namely the Consumer Price Index (CPI). As we detailed in the weekly analysis, following the release of the hot NFP report and the market's reconsideration of expectations for the Federal Reserve's interest rates, the sensitivity of the market to consumer inflation and Producer Price Index (PPI) results, which will be released tomorrow, has increased more than ever before.
This month, it is expected that the Core CPI index will be 0.3% on a monthly basis and 3.7% on an annual basis, facing a 0.1% decrease in both periods compared to the previous equivalent period. It is also expected that the headline Consumer Price Index will decrease by 0.1% on an annual basis compared to the previous period, reaching 0.3%, and record a 0.2% increase on an annual basis, reaching 3.4%. In the producer inflation sector, predictions indicate a relative decrease in this area.
Sticky and hotter inflation than expected can put a brake on the upward movement of gold if there is a slight reduction in the pace of geopolitical risks and demand for the yellow metal. Otherwise, any correction in gold due to hot inflation will be temporary. The intensity of this correction will also depend on the reaction of the dollar and the stock market. If the dollar shows a confused and uncertain reaction similar to recent days, in practice, gold will pass by the threats of US inflation with little difference.
From a technical perspective, if gold can establish itself above 2360.37, its next targets will be:
2410.73, 2530.73, and 2646.67. Otherwise, any move above 2360.37 towards the downside will be a temporary selling opportunity towards targets of 2228.55 and 2179.67.
In the analysis on March 27, we mentioned how global gold has room for further record-breaking. Gold continues to conquer new peaks. On one hand, intensified geopolitical tensions and, on the other hand, demand for the yellow metal as a safe haven, particularly by major global banks, have caused gold to continue its bullish trend. Today, the market is awaiting the results of one of the biggest economic indicators of the month, namely the Consumer Price Index (CPI). As we detailed in the weekly analysis, following the release of the hot NFP report and the market's reconsideration of expectations for the Federal Reserve's interest rates, the sensitivity of the market to consumer inflation and Producer Price Index (PPI) results, which will be released tomorrow, has increased more than ever before.
This month, it is expected that the Core CPI index will be 0.3% on a monthly basis and 3.7% on an annual basis, facing a 0.1% decrease in both periods compared to the previous equivalent period. It is also expected that the headline Consumer Price Index will decrease by 0.1% on an annual basis compared to the previous period, reaching 0.3%, and record a 0.2% increase on an annual basis, reaching 3.4%. In the producer inflation sector, predictions indicate a relative decrease in this area.
Sticky and hotter inflation than expected can put a brake on the upward movement of gold if there is a slight reduction in the pace of geopolitical risks and demand for the yellow metal. Otherwise, any correction in gold due to hot inflation will be temporary. The intensity of this correction will also depend on the reaction of the dollar and the stock market. If the dollar shows a confused and uncertain reaction similar to recent days, in practice, gold will pass by the threats of US inflation with little difference.
From a technical perspective, if gold can establish itself above 2360.37, its next targets will be:
2410.73, 2530.73, and 2646.67. Otherwise, any move above 2360.37 towards the downside will be a temporary selling opportunity towards targets of 2228.55 and 2179.67.
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