FUNDAMENTAL
OVERVIEW
The strong bullish momentum in gold has waned recently, likely due to some
profit-taking ahead of the Jackson Hole event. After the Treasury buyback announcement and Bessent’s “verbal” intervention
to suppress long-term yields, traders will be eager to see whether Fed Chair Warsh
leans against the easing in financial conditions.
If he doesn’t, gold will likely get another boost from further easing in
financial conditions and the dovish repricing in near-term interest rate
expectations. On the other hand, if he pushes back saying things like
“recent easing in financial conditions, if sustained, could complicate the
process of returning inflation to our target” or “if recent easing
threatens progress toward price stability, we will not hesitate to respond
appropriately” and so on, the market may interpret it as a signal for a
potentially hawkish September FOMC and put pressure on gold.
GOLD TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can
see that the bullish momentum in gold has waned a bit recently as we approach the
Jackson Hole event. The natural target should be the swing high level around
4,890. If the price gets there, we can expect the sellers to step in with a
defined risk above the swing level to position for a drop into the 3,885 level.
The buyers, on the other hand, will want to see the price breaking higher to
increase the bullish bets into the 5,400 level next.
GOLD TECHNICAL ANALYSIS – 4
HOUR TIMEFRAME
On the 4 hour chart, we have
an upward trendline defining the bullish momentum. If we get a pullback into
the trendline, we can expect the buyers to lean on it with a defined risk below
it to keep pushing into new highs. The sellers, on the other hand, will want to
see the price breaking below the trendline to pile in for a drop into the 3,885
level next.
GOLD
TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, we
have another minor trendline defining the current pullback. The buyers will
likely continue to lean on the downward trendline with a defined risk above it
to keep pushing into new lows. The buyers, on the other hand, will look for a
break higher to increase the bullish bets into the 4,890 level next. The red
lines define the average daily range for today.
UPCOMING CATALYSTS
Todaywe get the US Jobless Claims figures. Tomorrow, we conclude the week
with Fed Chair Warsh’s speech at the Jackson Hole Symposium.
This article was written by Giuseppe Dellamotta at investinglive.com.