continues to hold below the midline, despite the latest bounce. US inflation report will revive the selling interest around the Gold price, smashing it through the key support near the $1,910 region to challenge the critical 200-Daily Moving Average (DMA) at $1,900. A sustained break below the latter will put the June 29 low of $1,893 to the test.
Only the downbeat US CPI data could rescue Gold buyers from monthly lows, with the recovery likely to face an initial hurdle at the $1,930 round figure, above which the downward-sloping 50-DMA at $1,942 could be challenged. The next significant upside barrier is seen at the $1,950 psychological level and then 100-DMA at 1967.
Prices are oversold as the fast stochastic prints a reading of 4.90, below the level of 20.
Silver Technical Report:
Silver is currently trading below both the 200 DMA and 50 DMA moving averages, priced at $23.24 and $23.66, respectively. This positioning suggests a bearish sentiment in the short term. The 14 Daily RSI is at 35.70, indicating that Silver is approaching oversold territory (below 30) and the Short term Stochastics Oscillator is already in oversold territory at 3. suggesting potential buying interest could emerge soon.
However, on these indicators, the market sentiment for Silver (XAG) appears bearish in the near term.
Fundamental Report :
Gold price is making another recovery attempt from four-week throughs of $1,914 early Thursday. Markets trade with caution, reflective of the mixed tone in the Asian indices even though the US S&P 500 futures post small gains. Investors resort to adjusting their US Dollar positions ahead of the all-important CPI inflation data from the United States, which will have a significant influence on the US Federal Reserve (Fed) policy path.
US annual headline CPI is seen rising 3.3% in July against a 3% increase recorded in June. The Core CPI inflation is likely to steady at 4.8% YoY in the reported period. On a monthly basis, both the headline and Core inflation figures are expected to hold steady at 0.2%.
According to CME Group’s FedWatch Tool, money markets are pricing 86.5% odds for the Fed to pause its tightening cycle at the September meeting while predicting the next move as a cut, likely in the spring of next year.
An upside surprise to the headline and core CPI data could revive expectations for Fed rate hikes, triggering a fresh upswing in the US Dollar alongside the US Treasury bond yields. Hot US inflation data is likely to exacerbate the pain in the Gold price, opening floors for a test of the levels below the $1,900 mark.