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Gold holds below $4,400 as traders wait for US CPI signals
FXStreet says gold is capped under nearby resistance near $4,500 while weak Nonfarm Payrolls have tempered Fed rate hike expectations heading into US inflation data.
Gold prices were supported by some dip-buying in the Asian session on Wednesday, halting a pullback from the $4,435 area, but the metal remained below the $4,400 level, according to FXStreet.
The outlet tied the cautious tone to traders awaiting key US inflation figures for fresh guidance on the Federal Reserve’s future policy path. It noted that Friday’s weak US Nonfarm Payrolls pointed to signs of a cooling labor market, which undermined the case for additional Fed rate hikes.
FXStreet also pointed to inflation risks linked to volatile energy prices, including crude oil strength. It said crude climbed to a one-and-a-half-week high after an advisor to Iran’s Supreme Leader said the Strait of Hormuz would not open until the US meets Tehran’s demands, and it cited escalated Red Sea and Bab el-Mandeb attacks by Iran-backed Houthi rebels as pushing war-risk premiums higher.
On the technical side, FXStreet reported gold hovering around the 100-day simple moving average, with overhead resistance stretching from a 50.0% Fibonacci retracement of the April to June decline toward the 200-day SMA around $4,500.5. It cited near-term support at the 100-day SMA around $4,388.3, with further levels at $4,298.5 and $4,161.4, and said a break lower could expose a structural floor near $3,939.8.
Latest closeGold $4,430.80 ▲1.6%|WTI crude $83.42 ▲1.6%