Gold Price (XAU/USD), Chart, and Analysis
- Bearish technical signals are sending gold lower.
- The US CPI will lead the next move in the precious metal.
Today’s US inflation data, due out at 13:30 UK, will set the tone for gold in the coming days and weeks. The headline inflation rate in the US is expected to decline to 8.1% in April from 8.5% in March. While any dip in price pressures would be welcome, it’s worth noting that the March reading was the highest level of headline inflation in the US in more than 40 years.
The US dollar is still supported and is likely to stay that way over the coming months as the Fed continues to raise interest rates. The US central bank is expected to raise interest rates by another 200 basis points this year, and while most of this is priced in the dollar, the US dollar is likely to rise further.
For all market-moving data releases and events, see DailyFX Economic Calendar.
The The daily chart of gold shows that the precious metal is slipping through its old horizontal support areas, not helped by the formation of two bearish star candles. These technical indicators maintained the bearish pressure on gold. The precious metal is also wrestling with the 200-day simple moving average for the first time in more than three months, and if it does not provide this support, gold will look to the 38.2% Fibonacci retracement level at $1,823 an ounce. As the next level of support. Resistance is at $1,871/oz. 50% Fibonacci retracement.
Daily Gold Price Chart – May 11, 2022
Retailer data show83.87% of traders are net long with the ratio of traders buying long to short positions at 5.20 to 1. The number of short traders is down 4.78% compared to yesterday and 0.94% less than last week, while the number of short traders is down 1.95% compared to yesterday and 20.24% less than last week.
We usually take a conflicting view with crowd sentiment, and the fact that traders are holding out indicates that gold prices may continue to fall.Positioning is net less than yesterday but more net than last week. The combination of current feelings and recent changes gives us more Mixed bias in gold trading.
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