XAU/USD corrects below $1,660; gain is likely before US GDP reports
After a massive gain from $1620 per ounce, the gold price (XAU/USD) is showing a time correction move in Asia. The price of the precious metal is steadily falling after it was unable to hold above $1660, although an uptrend is still seen as more likely given the upbeat market atmosphere.
Reported by Fx Street, investors’ attention will continue to be focused on the US Gross Domestic Product (GDP), which will show the state of the growth rate in economic activity. According to consensus, on an annualized basis, the US economy’s growth rate decreased by 0.6% in the second quarter. A weaker-than-anticipated outcome will boost gold prices even more.
As the Federal Reserve continues to raise interest rates at historically high levels, the gold market will continue to lose money. But the gold price will resume its upward once indications of a probable Fed relaxation appear. And based on the most recent outlook from ING, that might happen as early as next year, reported by Kitco news.
Technically, early today saw an almost 2.5-year low in December gold prices. Today was a bullish “outside day” for prices as well. The near-term technical advantage is still firmly in favor of the bears on gold futures. On the daily bar chart, prices are down trending since six weeks. The next price goal for the bulls is to close above strong resistance at $1700. The next short-term price target for the bears is to drive futures prices below strong technical support at $1600.
Therefore, with gold is downtrend in the technical daily chart, playing between $1614 to $1662. First resistance is seen at today’s high of $1666 and then at $1675. First support is seen at $1631 and then at $1621. Investors should set a stop-loss function in order to protect their capital.