Price settled around that summit until the reaction of the US dollar is known to the minutes of the last meeting of the Federal Reserve Bank. At a time when the markets are awaiting the bank's reaction to the US inflation which exceeds the bank’s goal in order to anticipate the date of tightening the bank’s policy, especially with the US progress in vaccination against the epidemic, until it comes to abandoning the face mask. All the recent statements by officials of the bank’s policy indicate that the bank will not change its policy based on the latest figures, as it wants the numbers to remain stable for a longer period as well as the continued strength of the US labor market.
The US dollar index DXY is heading towards its lowest levels in several months while it risks a stronger collapse as Europe took its first steps in the reopening process and outperformed the risk currencies. Investor reactions to the Federal Reserve meeting minutes today, Wednesday, will be fundamental to how the dollar closed trading this week.
The dollar was sold en masse ahead of the mid-week session after European currencies were heavily bought, putting the dollar index on its path for a fourth consecutive session of declines, as price action plays a role amid tepid drops in global bond yields and risk gains in assets such as stocks and commodities.
Economically, UK jobs data came in stronger than expected for the month of March when the unemployment rate hit a sudden drop, with the release of the numbers as the UK eased restrictions on supposedly non-essential businesses.
The dollar index is made up of 57% of the euro’s price against the dollar, so it is particularly sensitive to movements in the single European currency that were performing strongly before the middle of the week as major European economies including France and the United Kingdom took steps to reopen them. The US dollar rose strongly last week when US inflation surprised markets with a sharp rise more than expected, rising to 4.2% annually in April and more than twice the Fed’s target level, supported by the resulting rise in US bond yields, in price action that halted previous selling. This was caused by the April nonfarm payrolls report that surprised the downside of the market expectations.
According to the technical analysis of gold: The price of gold may still maintain its recent gains until the reaction of the US dollar and the markets is known to the contents of the minutes of the last meeting of the US Federal Reserve later today, especially with the increasing fears of markets about the recent sharp rise in US inflation. The stability of the price of gold above the psychological resistance of $ 1800 will remain supportive of the bulls' control of performance, taking into account that recent successive gains have pushed the technical indicators to levels that are saturated with purchases..
The closest levels of resistance to gold are currently 1882, 1900 and 1915 dollars, respectively. It will be the first reversal of the trend as the gold price moves towards the 1810 support level, which pushes it to the next most important support of $ 1785
