Gold prices closed a week in the positive area. The US Dollar lost its power towards the end of the week despite the Fed’s hawk stance. Market analyst Eren Şengezer says that gold can prolong the recovery if he approves $ 1,675 as a support.
Although gold prices started bad next week, power rose on Tuesday
At the beginning of the week, the negative change in the risk of risk helped the dollar to maintain its resistance to its rivals. Thus, the price of gold continued to maintain the downward movement. PMI data from China showed that commercial activities narrowed in October. This led investors to take refuge.
On Tuesday, the Australian Reserve Bank increased its policy rate only by 25 basis points. After that, the US Treasury bond returns fell. In this environment, gold prices reversed the direction. In the second half of the day, data from the United States revealed that Jolts Open job advertisements rose to 10.7 million compared to the market expectation of 10 million on the last working day of September. This helped him find the floor of the dollar. In addition, ISM manufacturing PMI came at 50.2 in October, exceeding 50 analysts’ estimates. The price of gold was forced to maintain the rise momentum with optimistic US data during the US transaction hours. However, gold earned approximately 1 %on Tuesday.
The monthly report published by Automatic Data Processing (ADP) on Wednesday revealed that employment in the US private sector increased by 239,000 in October. This data left behind the 193,000 market estimation. However, the US Dollar could not provide support for the investors to remain on the sidelines before the highly anticipated policy announcements. Meanwhile, gold prices managed to increase their gains on Tuesday and rose to $ 1,660.
Fed’s interest rate decision and Powell’s speech created a fluctuation
Kriptokoin.comAs you have followed, the Fed increased its policy rate by 75 BPS after the Fed November meeting. In a policy statement, the Fed said that he would take into account the speed of interest rate hikes “cumulative tightening, policy delays and economic and financial developments”. This comment triggered a risk rally because it pointed to a smaller interest rate of 50 BPS in December.
However, FOMC President Jerome Powell said that he expects the terminal interest rate to be revised in the point graph in the Summary of Economic Forecasts in December. So he reiterated the Fed’s hawk stance. Powell has announced that it is more important to reach the upper limit of policy interest rather than the size or speed of interest rates. In contrast, the US Treasury bond returns won traction. Gold prices closed the day in the negative area below $ 1,640 by making a sharp U -turn. With the positive effect of the Fed on the dollar, Thursday has declined to its lowest level since September September
Gold prices closed the week with a strong rise
The renewed market atmosphere for renewed optimism on China’s relaxation of coronavirus restrictions provided support underneath. In this direction, he opened the door of a decisive recovery. The US dollar was forced to find demand as a safe port. It also helped to increase gold to $ 1,650 before the employment report in October.
The US Office of Statistics reported that on Friday, non -agricultural employment increased by 261,000 in October and exceeded the market expectation of 200,000 with a wide difference. However, annual wage inflation measured with average hourly earnings fell from 5 %to 4.7 %. Wall Street’s main indices rose determined after this report. Thus, the golden rose strongly to finish the week on a solid foundation above $ 1,660.
There is a US intermediate choice on Tuesday, what will the effect be?
In the first half of the week, they do not have high -effective macroeconomic data broadcasts. For this reason, market participants will closely pay attention to the developments surrounding China’s zero Covid policy. According to the analyst, if China decides to soften its stance on the re -opening and confirm market rumors, it is likely to gain strength with the appearance of a healing demand.
On Tuesday, there are US midterm elections. However, the analyst says it is difficult to say what kind of impact on the performance of the US dollar against its competitors or the general market atmosphere.
The event of the week will be US CPI data
The US Office of Working Statistics will publish the consumer price index (CPI) data on Thursday. The annual core CPI is expected to increase from 6.6 %to 6.9 %in September in September. Analyst makes the following assessment:
A strong inflation data will remind investors the willingness of the FED on the way to an aggressive tightening. Thus, it will cause gold to fall under the pressure of fall again. On the other hand, a softer data than envisaged, allowing markets to withdraw their 75 BPS December interest rate hike bets. This is possible to provide support in the short term.
According to CME Group Fedwatch Tool, markets are still pricing a 50 BPS increase at the last FOMC policy meeting of the year.
On Friday, the Economic Report of the United States will include Michigan University’s November consumer sensitivity survey. Markets will pay attention to 5 -year consumer inflation expectations instead of consumer confidence index. In October, the long -term inflation component rose from 2.7 %to 2.9 %in September. According to the analyst, a data of 3 %can lead to a simple market response on gold. However, the opposite also applies.
Gold Prices Technical View and Gold Emotion Survey
Market analyst Eren Şengezer makes the following analysis regarding the technical appearance of gold. The relative power index (RSI) indicator in the daily graph increased above 50. In addition, gold prices on Friday for the first time for the first time on the 20 -day simple moving average (SMA) closed. For this reason, the technical appearance pointed out a rise shift in the near term.
In the increasing direction, $ 1,675 (static level, 50 -day SMA) stands as an important pivot level. If buyers approve this level as support, additional gains are possible towards $ 1,700 and $ 1,720. In the lower direction, the 20 -day SMA, $ 1,620 (the last point of the downward trend) and $ 1,600 (psychological level) before $ 1,650.
Despite the decisive recovery on Friday, experts were not convinced that gold would continue to rise in the near term. The average targets in one -week and one month view are $ 1,639 and $ 1,653, respectively.
