XAUUSD: Buy bullish in 2500-2505 area, target 2530Gold fundamentals:
The US dollar continued to fall, closing at a low of 100.55, and fell 3.2% in August, the largest monthly drop since November 2022, which significantly increased the attractiveness and demand for gold.
The market's expectation of a rate cut in September is almost a foregone conclusion. The current focus is on the possibility of a 50 basis point rate cut. Rate cuts usually reduce the opportunity cost of holding gold, making gold more attractive as an interest-free asset.
In addition, Powell's dovish signal at the Kansas City Fed meeting has boosted demand for non-US dollar wealth storage tools. Futures traders expect a cumulative rate cut of about 106 basis points in 2024, which further enhances the market's bullish expectations for gold.
At the same time, the escalation of geopolitical conflicts in the Middle East and Russia-Ukraine has intensified the market's risk aversion and further promoted demand for gold.
Gold technical aspects:
In yesterday's gold analysis, I clearly mentioned the support strength of the 2500-2505 area, and this area has resisted the decline for many times without breaking, so we can still continue to believe in the support of this area. If it retreats to this area during the day, you can consider buying again.
Of course, we still need to consider the precautionary actions after the break here. Combined with the above analysis, my trading strategy today is similar to yesterday, as follows:
First of all, the main bullish, as long as the gold price retreats to the 2500-2505 area, you can consider buying, the target is 2530, 2550
On the contrary, if it effectively falls below 2500, you can choose to sell near 2500. What needs to be noted here is the effective break, not the false break
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