Gold Price Forecast: XAUUSD advances firmly above $1850 on weaker USD and falling real yields By christianborjon Gold XAUUSD Commodities Metals Macroeconomics
demand and US dollar buyers taking profits weakened the greenback and lifted Gold prices, with XAU/USD trading at $1854.60, gaining 1.14%.is keen late in the week after the US Federal Reserve raised rates by 75 bps on Wednesday afternoon, followed by Fed Chair Jerome Powell’s press conference.said that he does not expect a move of 75 bps to be “common” but mentioned that the July meeting is open for a 50 or 75 bps rate hike.
Besides the buck’s value and the US 10-year Treasury nominal yield, Gold traders need to be aware of real yields. The US 10-year Treasury Inflation-Protected Securities yield, a proxy for real yields, sits at 0.651%, down from daily highs at 0.893%. Meanwhile, harmful US housing data shifted traders’ attention towards a recession scenario. Housing Starts in the US for May dropped by -14.4%, while Building Permits followed suit, edging lower by -7%. Furthermore, the Philadelphia Fed Manufacturing Index for June showed signs of a slowing US economy contracting by -3.3, much lower than estimations of 5.5.Gold’s daily chart depicts the pair as neutral.
Upwards, the XAUUSD’s first resistance would be the 50-day moving average at 1876.91. Break above would expose the aforementioned June 13 high, followed by the $1900 mark. On the other hand, XAUUSD’s first support would be June’s 16 low at $1814.68. A breach of the latter would expose the June 14 low at $1804.95, followed by the May 16 cycle low at $1786.50.
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