January 31, 2025 at 08:22AM
Fundamental
Overview
After a brief divergence
from real yields, gold caught up and extended the rally into a new all-time
high helped by a benign FOMC
decision. In fact, the Fed kept everything unchanged as expected and
although Fed Chair Powell didn’t offer much in terms of forward guidance, he
was optimistic on inflation and dismissed some worries.
That was what the market
needed to catch up with falling real yields which topped with the last US
inflation data. The trend remains bullish as long as inflation continues to
ease. The biggest threat to gold is another hawkish repricing in interest rates
expectations or a strong growth scare.
Gold
Technical Analysis – Daily Timeframe
On the daily chart, we can
see that gold finally managed to extend the rally into a new all-time high
yesterday. The buyers will likely pile in around these levels to increase the
bullish bets into new highs, while the sellers will look for a drop back below
the 2790 level to position for a pullback into the 2721 level next.
Gold Technical Analysis
– 4 hour Timeframe
On the 4 hour chart, we can
see that we have an upward trendline defining the bullish momentum. The
buyers will likely continue to lean on it to keep pushing into new highs, while
the sellers will look for a break below it to increase the bearish bets into
new lows.
Gold Technical Analysis
– 1 hour Timeframe
On the 1 hour chart, we can
see that we have a little consolidation just above the all-time high. This is
where we expect the buyers to pile in with a defined risk below the 2790 level,
while the sellers will look for a drop below the level to target a pullback
into the trendline. The red lines define the average daily range for today.
Upcoming
Catalysts
Today we conclude the week with the US PCE
and the US Employment Cost Index.
Watch the video below
This article was written by Giuseppe Dellamotta at www.forexlive.com.
