Gold bounces off one-week low on soft USD; upside seems capped ahead of US inflation data
Gold (XAU/USD) rebounds from a one-week low, around the $4,340 area touched during the Asian session on Wednesday and, for now, seems to have snapped a three-day losing streak.
Gold prices rebounded from a one-week low near $4,340, driven by a soft US Dollar (USD) and yen-led Bank of Japan (BoJ) rally. The prospect of further central bank rate hikes, including a potential 25 basis point increase by the European Central Bank (ECB) and the BoJ, might cap any significant gains for the non-yielding commodity.
Geopolitical tensions between the US and Iran have added a risk premium to the market, supporting crude oil prices and inflation expectations. Traders will be watching US Nonfarm Payrolls data, US inflation indicators like the Producer Price Index (PPI) and Consumer Price Index (CPI), and the release of Fed meeting minutes for clues about the Federal Reserve's (Fed) policy direction.
Should gold break above $4,427, it could face resistance at the 38.2% Fibonacci retracement at $4,529. On the downside, technical support is provided by the 200-period Simple Moving Average (SMA) around $4,352.88.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
Also reported by 3 other outlets
- Gold slumps to near $4,350 amid oil-driven inflation fears, US inflation data in focus fxstreet.com
- Gold firms on softer dollar, inflation data and Mideast risks in focus thehindubusinessline.com
- Gold firms on softer US dollar; inflation data and Mideast risks in focus businesstimes.com.sg
