Back on August 21, gold was trading below USD 1,890 an ounce, but to date, its price has risen by about 3%. This was helped by published data on the number of vacancies in the US, which fell to the lowest level in almost 2.5 years in July. This and other signals of a slowdown in the US economy may influence the Fed’s decision to continue raising interest rates further, which weakens the US dollar and supports the price of gold.
Bullish arguments:
→ the psychological barrier of USD 1,900 serves as an important support. The price of gold was there for only a few days, after which a steady increase followed.
→ The USD 1,920 resistance level was taken under control by the bulls after the breakdown on August 28-29. Now we can expect that there will be support here.
→ If a moderate decline on low volumes follows in the coming days, this will be a sign of a normal correction in a bull market
Bearish arguments:
→ Expect resistance from USD 1,950. It is possible that if an attack follows it, it will turn into a false breakdown.
→ Gold is within a descending channel (shown in red) and its upside price may be resisting gold’s uptrend.
Be prepared for a surge in volatility today at 15:30 GMT+3, at which time Personal Consumption Expenditure (PCE) and monthly employment figures are released, important indicators of the economy in terms of impact on US interest rates.
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