Contents
The Gold Price Rebounds amidst escalating tensions in the Middle East and lingering uncertainty surrounding the Federal Reserve‘s rate policies. The XAU/USD, having recently recovered from a one-month low around $2,013, is showing positive traction for the second consecutive day, adding an interesting twist to the market dynamics.
Highlights:
- Gold Price Rebounds in recent days, fueled by both geopolitical tensions and uncertainty surrounding the Federal Reserve’s rate cut trajectory.
- The price has found support at the 50-day Simple Moving Average (SMA), and technical indicators suggest that it could continue to rise in the near term.
- Key resistance levels are at $2,040-2,042 and $2,064.
- Key support levels are at $2,022 and $1,973.
- Market watchers will be closely watching the US Producer Price Index (PPI) and Minneapolis Fed President Neel Kashkari’s upcoming speech for further direction on the gold price.
Read more: Inflation Data Awaited: Gold Reacts to Market and Dollar
Gold Price Rebounds: Gold Finds Support at 50-Day SMA
The recent rebound in the gold price is technically supported by a bounce from the 50-day Simple Moving Average (SMA). The positive momentum, evident in the daily chart’s oscillators, suggests a favorable scenario for bullish traders. However, a cautious approach is advised, with a wait-and-see stance recommended until a sustained strength beyond the $2,040-2,042 supply zone is confirmed.
Resistance and Potential Upside: A Closer Look at Key Levels
To gain additional momentum, the gold price must surpass the $2,040-2,042 hurdle. Successful navigation through this zone could propel the precious metal towards last Friday’s swing high at around $2,064, with further potential to reach the $2,077 area. Breaking through these levels might pave the way for reclaiming the psychological $2,100 mark.
Downside Protection: Key Support Levels in Focus
On the downside, the $2,022 area acts as immediate support, guarding against a slide to the multi-week low near $2,013 or the 50-day SMA, tested on Thursday. A breach below these levels could trigger a bearish outlook, potentially pushing the gold price towards $2,000 and further down to the December swing low around $1,973, which coincides with the 100- and 200-day SMAs at $1,965-1,963.
Conclusion
In conclusion, the recent Gold Price Rebound is fueled by both geopolitical tensions in the Middle East and the prevailing uncertainty over the Federal Reserve’s rate cut trajectory. While technical indicators support a bullish stance, caution is advised until the $2,040-2,042 resistance is overcome. As the market keeps a close eye on the US Producer Price Index (PPI) and Minneapolis Fed President Neel Kashkari’s upcoming speech, the gold price’s resilience will likely face both headwinds and tailwinds in the near term.
