Buy Low and Sell High During Fluctuation

Summary:

Powell hinted that the Fed is considering a rate cut, but would not give a specific date. This uncertainty is driving up volatility in the rate-sensitive precious metals market.

SELL XAUUSD

Close Time

CLOSED

2383.44

Entry Price

2300.00

2427.00

4027.32 -22.20 -0.55%

435.6

Pips

Loss

2300.00

2427.12

Exit Price

2383.44

Entry Price

2427.00

Fundamentals

Federal Reserve Chairman Powell testified on Tuesday morning before a Senate Banking, Housing, and Urban Affairs Committee hearing, reaffirming key messages from the June FOMC meeting including a dovish stance on the federal funds rate.

In his opening remarks, Powell stated, "The Fed remains focused on our dual mandate of promoting maximum employment and stable prices for the benefit of the U.S. people." He highlighted significant progress over the past two years towards achieving the Fed's 2% inflation target, with labor market conditions remaining robust while cooling slightly. These developments have helped better balance the risks to achieving our employment and inflation objectives." These factors are seen as key drivers behind speculation of a rate cut in September, though Powell refrained from disclosing a specific date. Such uncertainty is fueling increased volatility in rate-sensitive precious metal markets.

Boosted by rising expectations of a Fed rate cut, gold prices continued their uptrend on Wednesday, reaching as high as US$2,375 during the European session as investors awaited the release of U.S. inflation data, keeping gold in the spotlight.

Furthermore, inflows into Exchange-Traded Funds (ETFs) have surged, enhancing gold's appeal with positive cash flows for the second consecutive month. This investment trend underscores gold's role as a safe haven asset amid financial market uncertainties.

Buy Low and Sell High During Fluctuation_1

Technical Analysis

Amid uncertain expectations of a Fed rate cut, the situation continues to impact the interest rate-sensitive precious metals market, leading to increased volatility. As of the time of writing, the spot gold price has surpassed US$2,380.

In the 4H timeframe, the gold price has rebounded four times from the key level of 2,350 since last Friday, forming a more complex top pattern. Despite the intraday gains in gold prices, from a broader perspective, it remains within the consolidation range that has encompassed most of the price trend since the beginning of April. We still recommend to buy low and sell high within the range.

Overall, the gold price shows a short-term uptrend, yet in a broader time frame, it is still consolidating. To achieve a positive outlook, a decisive break above the psychological threshold of 2,400 is needed.

Trading Recommendations

Trading Direction: Sell

Entry Price: 2387

Target Price: 2300

Stop Loss: 2427

Deadline: 2024-07 - 25 23:55:00

Support: 2329, 2337, 2330, 2319

Resistance: 2371, 2378, 2387, 2400

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

Risk Disclosure

The risk of loss in trading financial instruments such as stocks, FX, commodities, futures, bonds, ETFs and crypto can be substantial. You may sustain a total loss of the funds that you deposit with your broker. Therefore, you should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources.

No decision to invest should be made without thoroughly conducting due diligence by yourself or consulting with your financial advisors. Our web content might not suit you since we don't know your financial conditions and investment needs. Our financial information might have latency or contain inaccuracy, so you should be fully responsible for any of your trading and investment decisions. The company will not be responsible for your capital loss.

Without getting permission from the website, you are not allowed to copy the website's graphics, texts, or trademarks. Intellectual property rights in the content or data incorporated into this website belong to its providers and exchange merchants.

Recent Searches

Top Searches

Markets

Analysis

User

24/7

Economic Calendar

Education

Data