Gold Technical Report: The daily chart shows that XAUUSD is at risk of falling. Technical indicators remain within negative levels, the Momentum slowly grinding lower and the RSI consolidating at around 36. The 50 DMA trading @ $1732, an area that has been important in the past. That being said, I think the market is likely to continue seeing a lot of volatility, so pay close attention to the negative correlation between this market and the US dollar. At this point it looks like we are knocking on the door of a significant breakdown.
The near-term picture is neutral. Technical indicators in the 4-hour chart stand directionless around their midlines. The 20 SMA is flat below the current level, but the longer ones keep marching downwards, far above the current price. Selling interest is aligned around the 50 SMA at $1,680 price zone, with limited chances of a bullish breakout. On the other hand, XAUUSD bottomed twice at around $1,654, and a clear break below it should lead to a steeper decline.
Silver Technical Report: Silver is playing rangebound after it ended last week with a big green candle as the prices just touching down and then bouncing back from 20 DMA with reversal signs.The next major resistence will be faced around 20.22 wich is a triple support in mid-August. The Short term Stochastics Oscillator is at 66 and RSI momentum near 55.
Fundamental Report: Gold trades around its daily opening, just above $1,670 a troy ounce. The bright metal consolidated within Wednesday’s $30 range as multiple central banks’ monetary policy decisions maintained traders busy since the day started. For the most, global policymakers are worried about bringing inflation down but seem more concerned about economic growth, regardless of refraining from commenting on potential recessions.
As investors finish digesting the latest batch of announcements, financial markets are clearly indicating risk aversion. Asian and European stock indexes closed in the red, while Wall Street navigates negative territory, with the three major indexes pressuring their weekly lows.
Meanwhile, Russia’s decision to escalate its attacks on Ukraine exacerbated the dismal mood. Moscow decided to mobilize troops on Wednesday, while President Vladimir Putin brought the possibility of a nuclear war to the table.
Higher government bond yields have prevented the dollar from falling after the US Federal Reserve delivered but failed to impress. The 10-year Treasury note currently yields 3.69%, while the 2-year note yield reached a multi-year peak of 4.16%, now hovering at around 4.13%.