- Gold price has been hovering around the $2334 per ounce level since yesterday after falling by more than 1% in the previous session, pressured by a strong US dollar and rising bond yields following reports of strong business activity in the United States.
- Last week, data showed that business activity hit a 26-month high in June, driven by a rebound in employment, while there was only a modest decline in initial jobless claims.
Concurrently, investors are looking ahead to this week’s economic data, including Friday’s US core personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation gauge, and several comments from Fed officials for clarity on the timeline for US interest rate cuts.
Meanwhile, official data showed that Swiss gold exports fell in May due to lower shipments to India and Hong Kong, while gold demand in India, the world’s second-largest gold consumer, slowed last week.
Factor influencing the gold market, the US dollar index DXY fell to 105.6 on Monday, pausing after a 0.3% gain the previous week, as traders prepare for key personal consumption expenditures inflation data and comments from several Federal Reserve officials due this week to assess the outlook for monetary policy. Therefore, the first presidential debate between Joe Biden and Donald Trump on Thursday will also be in the spotlight. The odds of a 25 basis point US rate cut by September are currently at 66% and traders are still betting on a quarter point cut this year. The US dollar fell across the board, but the biggest losses were against the euro, the pound and the yen.
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Another factor influencing the gold market, the US 10-year Treasury yield was little changed.
According to trading, the US 10-year Treasury yield was little changed at 4.26% to start the final week of June, as traders prepare for key personal consumption expenditures inflation data and comments from several Federal Reserve officials due this week to assess the outlook for monetary policy. Economic data was mixed, with S&P Global PMIs showing faster growth in manufacturing and services activity while initial jobless claims remained high and retail sales, housing starts and building permits disappointing.
Currently, the odds of a 25-basis point Fed rate cut by September are currently at 66% and traders are still betting on a quarter point cut this year.
Gold Price Forecast and Analysis Today:
From a daily technical analysis point of view, according to the performance on the daily chart attached, gold is in a neutral position and the bias will be more bullish if it settles above the resistance of $2355 per ounce again, which in turn will encourage bulls to move strongly upwards and not rule out the resistance levels of $2370 and the psychological resistance of $2400 per ounce respectively. In contrast, and over the same period of time, the support of $2300 per ounce will remain the most important to complete the recent downward correction. The US inflation reading at the end of the week, the level of the US dollar and the increase in global geopolitical tensions are the most prominent factors influencing the price of gold in the coming days.
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