Gold Rebound on short covering after hot U.S. CPI
The price of gold (XAUUSD) is still under pressure below $1,730, undoing the previous day’s recovery from an 11-month low on Thursday during the Asian session. The market’s worries about a recession, rising interest rates, and the strength of the US dollar may all be contributing factors to the metal’s downfall.
The consumer price index report for June came out quite strongly on Wednesday last night, up 9.1 percent year over year. If not the U.S. data point of the week. An increase of 8.5 percent year-over-year was anticipated. The CPI increased by 8.6 percent yearly in the May report. There is a 75% likelihood the Fed will have to make another 0.75 percent rate hike at its upcoming FOMC meeting on July 26–27, according to the markets’ initial reactions to the CPI report. There is a 30% possibility that the Fed will raise interest rates by the entire 1.0 percent at the meeting.
According to Reuters, in response to the US statistics, White House (WH) Economic Adviser Brian Deese told CNBC that the CPI data highlights the need for Congress to swiftly adopt legislation to boost semiconductor production in the US. However, US President Biden stated that because gas costs have decreased, CPI data is “out of data.”
Technically, August gold futures prices hit an 11-month low early on today and the reversed course to score a bullish “outside day” up on the daily bar chart. Bears still have the solid overall near-term technical advantage. Prices are in a four-month-old downtrend on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1800. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $1700. Reported by Kitco.
Investor should be notes that gold chart is in down trend line and in range from 1707 to 1752. First resistance is seen at today’s high of $1740, $1745 and then at $1751 First support is seen at $1716 and then at today’s low of $1710. Investment is risky, so investors need to set stop-loss function.
Analyzed by: Ms. Teang Riya Independent Analyzed
PP Link Securities Co., Ltd. endeavors to ensure the accuracy and completeness of this research report. However, as the market is subject to change, the Company and our subsidiaries do not guarantee its completeness and accuracy, and the information is for reference only. Any person shall not regard such information as PP Link Securities Co., Ltd. on leveraged foreign exchange, precious metals, stocks, and other financial products to provide real quotes, suggestions, solicitation, and inducement of investment. Guests should be aware of the risks involved in the investment, the volatility of the investment market, and the risk of loss can be very big, guests must carefully consider their own financial situation and investment purposes, to decide the direction of investment and the kind of investment products that are suitable for their owns.