Gold rose on Tuesday as the dollar it was priced at stabilized, prompting some investors to buy the yellow metal ahead of US inflation data that could affect the Federal Reserve’s monetary policy. Economists at ANZ Bank note that gold is well supported at $1,850 and a break above $1,930 awaits confirmation of bullish action.
Keys for precious metals prices
Aggressive monetary tightening, higher interest rates and a stronger dollar are key drivers for gold prices. Meanwhile, sustained inflation and rising geopolitical risks should protect the yellow metal somehow. Technically, economists at ANZ Bank are waiting for gold to confirm bullish action on a break above $1,930.
Aggressive Fed rate hikes, faster quantitative tightening, a stronger US dollar and possible easing of the Russian invasion of Ukraine are possible main headwinds for gold prices, according to economists at ANZ Bank. Higher inflation risks and ongoing geopolitical tensions will likely offset some of these risks, economists say.
“Gold can reach $2,000 and $2,050 levels if it breaks $1,930″
According to economists, the key development to watch is the Fed’s its response to any upside surprises in inflation that could affect the real interest rate. Economists, looking at gold prices from the technical front, draw attention to the following levels:
We see that the short-term key support level is $ 1.850. If it drops below that, prices could easily pull back to $1,800. We expect a trading range of $1,850-1,930 in the coming days. A convincing break above the $1,930 upper trendline will confirm the bullish move. Once this level is broken, prices could reach the previous $2,000 and $2,050 levels.
By the way, As we reported on Kriptokoin.com , some Fed officials will make statements this week and the focus of investors will be on these conversations. The words of John Williams and President Christopher Waller of the New York Fed are given great importance. After Fed Chairman Jerome Powell’s press conference last week, which did not provide much clarity on the Fed’s roadmap, these speeches are expected to shed some light on the market.
