Fed is "hawkish", GOLD corrects and stays above EMA21

XAUUSD remains weak on the recovery of the US Dollar and the release of the US Producer Price Index (PPI) and Consumer Price Index (CPI) later this week will be the focus of market attention.

Traders need to prepare for a busy period of economic data and events in the United States (US), which will include inflation data, retail sales data and a speech from the Chairman of the Reserve Federal Jerome Powell on May 14.

Earlier Monday, Federal Reserve Vice Chairman Philip Jefferson spoke to the media during a question-and-answer session at the Cleveland Fed. He said it would be appropriate to keep interest rates steady until there is further evidence that inflation will return to the central bank's 2% target.
Jefferson described the Fed's policy as restrictive and said the lack of progress in inflation in the first quarter was worrying.

Meanwhile, the US Bureau of Labor Statistics (BLS) is expected to release April consumer and manufacturing inflation data on May 14-15. If price pressures pick up again, the Fed could keeping interest rates higher “longer” and of course this is not beneficial for gold prices.
Rising inflation expectations suggest the Fed may continue to delay expected interest rate cuts. This is not good for gold because higher interest rates increase the opportunity cost of holding gold compared to interest-earning assets like bonds or cash.

Hawkish comments from Federal Reserve officials continued to factor into a sharp correction in gold prices on Monday.

According to IMF data, Singapore increased its gold holdings by 4,448 tons to 236,610 tons in March 2024; Iraq increased its gold holdings by 3,079 tons to 145,661 tons in February 2024; Poland increased its gold holdings by 11,626 tons to 145,721 tons; 4,666 tons to 363,371 tons in April 2024.

Technical analysis of XAUUSD outlook
On the daily chart, although the gold price has corrected significantly from the upper channel edge to maintain the main downtrend price channel, the correction from the $2,366 technical point is of note to readers in the release of the issue. The interim week is also being constrained by the EMA21 level and the technical point of 2,330USD.
The fact that gold is still above EMA21 does not make it eligible to fall more. However, once gold moves below $2,330 it will be eligible for more declines with the highest short-term target being the 0.236% Fibonacci retracement level.

During the day, gold is still trending downward and notable technical levels will be listed as follows.
Support: 2,335 – 2,330USD
Resistance: 2,353 – 2,366USD

🪙SELL XAUUSD | 2356 - 2354

⚰️SL: 2360

⬆️TP1: 2349
⬆️TP2: 2344

🪙BUY XAUUSD | 2305 - 2307

⚰️SL: 2301

⬆️TP1: 2312
⬆️TP2: 2317

Comment:

🟡Gold futures rose during the Asian session

Gold futures rose during the Asian session on Tuesday.

According to the New York Mercantile Exchange's COMEX classification, June gold futures were trading at USD2,349.35 per ounce at the time of writing, up 0.27%.

It was previously trading at a high of USD2,350.50 per ounce. Gold may find support points at USD2312.90 and resistance at USD2385.30.

Trade active:

Plan SELL Close 1/2 + 80pips. Move SL to Entry🔥

Comment:

Fed Chairman Powell reiterated the Fed has the ability to keep interest rates higher for longer

+++ Officials should be patient and let the restrictive policy work

+++ Lack of progress on inflation in the first quarter

Comment:

Gold prices touched $2,359 on Tuesday after data released by the US Department of Labor revealed that inflation rose above estimates. However, US government bond yields are sliding, an obstacle for the greenback.

Comment:

Comment:

🔼GOLD reaches this level before the US inflation data is revealed

Gold prices rose during these moments of trading, today, Wednesday, as investors looked forward to reading inflation data in the United States that could provide evidence on the path of reducing interest rates by the Federal Reserve.

Comment:

Fed Chairman Jerome Powell said the labor market is strong but is also gradually cooling. Fed policymakers are trying to tamp down inflation by weakening demand across the economy and looking for more signs that the labor market is easing.

Comment:

New York Fed President John Williams acknowledged a positive turn this week as April CPI data was lower than expected and retail sales did not increase during the month. However, the data has not yet prompted policymakers to say anything concrete about when interest rates might fall, as Fed Chairman Jerome Powell said earlier this week that although the underlying outlook for inflation The decline in inflation remains intact, but the Fed isn't entirely confident about it after three months of disappointing inflation data.

Comment:

Gold prices climbed to a record peak, stabilizing around 2,437 USD/oz amid increasing geopolitical tensions

XAU/USD accelerated on Monday. Gold prices hit a record peak of nearly $2,441 during the Asian session amid growing expectations of interest rate cuts from the Fed and rising geopolitical tensions in the Middle East. Meanwhile, escalating tensions between Russia and Ukraine also fueled demand for safe-haven assets, with both countries carrying out attacks over the weekend.

Comment:

🟡Gold slides from record high amid dollar stability

Global gold prices declined during these moments of trading, today, Tuesday, after reaching a new record peak reached in the previous session due to growing bets on lowering US interest rates and geopolitical risks that drive demand for safe havens.

Comment:

Despite a slight downward trend during the day, gold prices generally maintained a positive picture. On the 4-hour chart, XAU/USD has formed a rising price channel since early May. Technically, the precious metal still maintains a positive outlook as it holds above the 100-period EMA.