Technical Analysis: Gold price rebounds from 50-SMA ahead of Fed inflation
Gold consolidates weekly loss while posting a corrective bounce from the lowest level in 13 days as traders await the US Core PCE Price Index for June, also known as the Fed’s favorite inflation gauge. In doing so, the precious metal takes a U-turn from the 50-SMA but stays on the way to posting a second consecutive weekly loss after refreshing the all-time high during mid-July. Despite the latest rebound in prices, the commodity’s sustained trading below a month-old rising support line, now resistance near $2,428, joins the bearish MACD signals and steady RSI (14) line to keep the sellers hopeful. However, a clear downside break of the 50-SMA level of $2,359 becomes necessary to recall the bullion sellers. Following that, the 100-SMA level of $2,324 and an upward-sloping support line from early May, near the $2,300 threshold, appear as some of the last defenses of the buyers. It’s worth observing that lows marked in May and June around $2,285 and $2,277 will act as additional downside filters for the metal traders to watch during its declines past $2,300.
Meanwhile, the 21-SMA level of $2,388 and the $2,400 threshold guard the immediate upside of the Gold price ahead of the support-turned-resistance line surrounding $2,428. Following that, May’s high of $2,450 and the latest peak surrounding $2,484 could entertain the XAUUSD bulls. However, an upward-sloping trend line resistance from early April, near $2,490 as we write, quickly followed by the $2,500 round figure, appear tough nuts to crack for the bullion buyers.
To sum up, Gold is likely to remain pressured within a trading range established since April. However, the trend line breakdown can join upbeat Fed inflation to please short-term sellers.
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