Interest Rate Decision Incoming! Gold Shakes Up the Market Above $4,000

Tank

Summary:

Traders currently estimate the probability of an immediate interest rate hike by the Federal Reserve at 30.5%.

BUY XAUUSD

EXP

TRADING

4035.04

Entry Price

4600.00

3600.00

3999.47 -28.95 -0.72%

0.0

Pips

Flat

3600.00

Exit Price

4035.04

Entry Price

4600.00

Fundamentals

Geopolitical tensions have escalated, and investors continue to monitor inflationary pressures and the outlook for interest rates. This escalation stems from Iran’s attacks on U.S. military forces stationed in the region. At approximately 5:45 p.m. Eastern Time, Iran fired multiple ballistic missiles at a U.S. military base in Jordan. According to a statement and video released by the U.S. military, all missiles launched by the Iranian Islamic Revolutionary Guard Corps were successfully intercepted. It is widely believed that this attack was a direct response to recent U.S. operations targeting Iranian naval vessels.

The market currently expects the Federal Reserve to keep interest rates unchanged at this meeting, though one to three committee members may support an immediate rate hike, signaling the start of a new tightening cycle in September. Capital Economics continues to view September as the baseline scenario for the first rate hike, while WrightsonICAP believes that new Chair Wash places a high priority on controlling inflation, making the likelihood of an immediate 25-basis-point rate hike this week even slightly higher than that of keeping rates unchanged. Overall, the market’s true focus is not on whether a rate hike will occur this week, but rather on whether the Fed is prepared to formally launch a new cycle of rate hikes that will span several future meetings.

Technical Analysis

On the four-hour chart, the Bollinger Bands are beginning to narrow, moving averages have flattened, and the MACD fast and slow lines are oscillating near the 0 axis. The RSI stands at 44, indicating strong market pessimism. On the daily chart, the Bollinger Bands are narrowing, moving averages have flattened, and a trend reversal could occur at any time. The RSI stands at 44, with investors predominantly pessimistic. However, gold is approaching the bottom range; the recommended strategy is to buy on dips.

Interest Rate Decision Incoming! Gold Shakes Up the Market Above $4,000_1

Interest Rate Decision Incoming! Gold Shakes Up the Market Above $4,000_2

Trading Recommendation

Trading Direction: Buy

Entry Price: 4030

Target Price: 4600

Stop-Loss Price: 3600

Support Levels: 3900, 3600, 3500

Resistance Levels: 4200, 4300, 4600

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Interest Rate Decision Incoming! Gold Shakes Up the Market Above $4,000

Risk Disclosure