- For the first time after a year, gold prices lost more than 5 %on a weekly basis.
- FOMC’s USD power, which did not decrease on Şahin’s views, dominated the financial markets.
- According to popular analyst Eren Şengezer, the next target for gold prices is $ 1,756.
Gold prices, after closing the previous week in the negative region, the first half of the week under pressure from moderate decline and lost on Monday and Tuesday. As the USD gained strength during the American trading hours on Wednesday, the XAU/USD expanded its decline and touched the lowest level of six weeks on Thursday, with about 5 %loss over a two -day period. Although gold prices made a correction before the weekend, it was forced to maintain recovery acceleration and closed the price slightly above $ 1,770 with 5.5 %on a weekly basis.
What happened in the gold market last week?
The data published by the US Office Bureau of Statistics on Tuesday showed that the Producer Price Index (PPI) increased by 6.3 %in May in May compared to market expectation of 6.3 %in May. Other data from the United States showed that retail sales narrowed 1.3 %on a monthly basis after the expansion of 0.9 %(revised from 0 %) in April. However, market participants have greatly ignored these readings before the highly anticipated FOMC event on Wednesday.
Following the June meeting, the US Federal Reserve announced that it has left the indicator interest rate, which is a target range for federal funds, as expected between 0 and 0.25 %. In a summ of the updated economic predictions, FOMC announced in the report in March compared to four policy makers, seven policy makers have seen an increase in zero in 2022 in the federal fund rate. More importantly, the number of policy makers, which expected an increase in the policy rate from zero in 2023, rose from seven to 13 in March.
In a policy statement, the FED reiterated that inflation will continue to support the supportive policy until a period of moderate to the moderate of inflation for a while to ensure that inflation reaches an average of 2 %over time and long -term inflation expectations remain intact at 2 %. At a press conference, FOMC President Jerome Powell acknowledged that inflation did not refuse the possibility of a higher time than expected. Jerome Powell also said that if the economy continues to progress, it would be appropriate to evaluate a contraction plan in the coming minutes.
FED President’s statements negatively affected the markets!
Fed’s Opinion on the point chart and President Jerome Powell’s cautious statements on inflation appearance triggered the USD rally. Reflecting the wide -based USD power, the US Dollar Index (DXY) climbed to the highest level of two months with 92.07 on Friday and gained more than 1.5 %in the second half of the week. On Thursday, the US Department of Labor said that the first unemployment applications in the week ending on June 12 increased to 412,000. This pressure came worse than the analysts’ 359,000 estimates, but did not trigger a visible market reaction because the performance of the dollar continued to dominate.
Due to the fact that high -level macroeconomic data was not disclosed on Friday, St. Louis Fed President James Bullard’s comments provided additional support to the USD and expanded the DXY weekly rally to delete the losses of XAU/USD. James Bullard acknowledged that the Fed’s June meeting was “a little hawk movement ve and added that inflation was more intense than expected.
Which developments are important for gold prices next week?
On Tuesday, Powell will testify in front of the Assembly election committee on the Coronavirus crisis in a meeting titled “Federal Reserve’s Reaction to Coronavirus Pandemis” on Tuesday. According to popular analyst Eren Şengezer, the president will not change his tone just a few days after the FOMC meeting, and his words are not likely to have a significant impact on the valuation of the USD. On Wednesday, IHS Markit will publish the preliminary manufacturing and service PMI reports in June. The headline figures are expected to confirm the ongoing growth in both service and manufacturing sectors at a strong speed. However, investors will closely follow the basic details of input price prints.
If these reports re -confirm the view that inflation will continue to rise, the USD may collect additional power and create weight on XAU/USD. On Thursday, the Central Bank of the UK (Boe) will announce its policy decision. There will be no press conference and Boe may avoid changing the forward -looking orientation. However, according to Analyst Eren Şengezer, a hawk view can trigger a sharp increase in GBP/USD pair and help XAU/USD return to the north. Meanwhile, the US Economy Office (Bea) will publish the last version of the first quarter GDP growth on Monday, and it is expected to match the previous predicted 6.4 %.
Finally, according to the analyst, Bea will release the Basic Personal Consumption Expenditures (PCE) Price Index on Friday. The Core PCE Price Index is expected to drop from 3.1 %to 2.9 %in April. A stronger PCE inflation than expected will allow the dollar to continue to perform better than its competitors, and vice versa.
Popular Analyst: Attention next week for gold prices!
According to popular analyst Eren Şengezer, the relative power index (RSI) indicator in the daily graph shows that for the first time since the beginning of March, the parity can make a technical correction before the next decline. However, according to the analyst, the XAU/USD reflected the dominance of the sellers in the current environment and fell below 200 days of SMAs and 100 days in a two -day period. According to the analyst, if gold prices do not make daily closing over 1,800 dollars (100-day SMA, Psychological level, Fibonacci April-June with withdrawal 50 %withdrawal), the pressure pressure is likely to remain in the near term.
According to the analyst above this level, the next critical resistance is at the level of $ 1,825 (Fibonacci 38.2 %withdrawal) before $ 1,835 (200 days of SMA). According to the downward analyst, strong support seems to have occurred at $ 1,756 (April 29, static level), $ 1,745 (static level), and $ 1,770 before $ 1,770 (Fibonacci 61.8 %withdrawal). Looking at the expert and economist comments, Gold may fall below $ 1,600 in the next three months. Kriptokoin.comAs we have reported before, for more gold estimation “6 Analysts: Gold prices can see these miscaries next week!You can review our article.
