Gold price (XAU/USD) slowed down on Tuesday after hitting a new highest point earlier. Since there aren’t many new reasons for prices to go up in a quiet day with no big economic news, gold might not rise much more. However, gold could still get some support from more people betting on the US Federal Reserve lowering interest rates, ongoing tensions in the world, and strong demand from central banks and buyers in Asia.
Gold traders will pay attention to what people from the Federal Reserve say. Later on Tuesday, there are some Federal Reserve officials speaking, including Waller, Williams, Barr, Bostic, Collins, and Mester. The most important thing to watch out for is the notes from the last meeting of the Federal Open Market Committee (FOMC), which will come out on Wednesday. Also, if Federal Reserve officials keep saying they might not lower interest rates, it could make the US Dollar stronger and push gold prices down.
Daily Digest Market Movers: Gold Price Faces Challenges Amid USD Rebound
Gold hit its highest price ever on Monday, reaching $2,450, and silver prices are close to their highest in 12 years. Gold has gone up by 18% this year, while silver has increased by 35%.
Fed Vice Chair Michael Barr mentioned that the central bank needs to give their strict policy more time to work.
Another Fed member, Philip Jefferson, who is part of the group deciding on interest rates, said that prices are still not going up as fast as he thought they would.
Raphael Bostic, from the Atlanta Federal Reserve, said that the rules about borrowing money are tight and it will take time before they’re sure prices will go up to 2%.
Investors think there’s a 76% chance that the Federal Reserve will lower interest rates by 0.25% in September and two more times by the end of the year, according to the CME FedWatch Tool.
Technical Analysis: Gold Price Maintains Positive Outlook
Gold price falls a bit today. Looking at the four-hour chart, gold still looks good because it’s above an important line called the 100-period Exponential Moving Average (EMA), and the line is going up. The Relative Strength Index (RSI), which shows if buyers or sellers are stronger, is around 69.00, suggesting that the support level might hold and not break.
If more people keep buying, gold might try again to go past the highest price ever, which is $2,450. After that, the next challenge is at $2,500.
But if gold falls more, the first support level is $2,420, which used to be resistance. If it goes down even more, the next stop might be $2,400. After that, the important level to watch is the 100-period EMA at $2,355.
US Dollar Price Trends This Week
The chart below displays how much the US Dollar (USD) changed compared to various major currencies this week. The US Dollar showed its lowest performance against the Pound Sterling.
The heat map displays how much major currencies have changed compared to each other. You choose the base currency from the left side and the quote currency from the top row. For instance, if you select the Euro on the left and then look across to the Japanese Yen, the percentage change shown in the box will tell you how much the Euro has changed against the Japanese Yen.
