GOLD Analysis
Afternoon: Gold Futures Rise Amid Stronger Dollar and Anticipation of Fed Rate Cut
Highlights:
- Gold futures rise amid stronger dollar and Fed rate cut bets; investors await key US economic data.
- Increased physical demand from India buoyed by reduced gold import tax.
- Technical levels: Pivot at $2,391.29, support at $2,361.72, and resistance at $2,423.81.
Market Outlook
Gold futures finished higher on Wednesday, despite a stronger dollar, as intensified bets over a September Federal Reserve interest rate cut bolstered yellow metal investments ahead of key US economic data. Investors are keenly awaiting the preliminary Q2 GDP figures due later today, and the June PCE price index report set to be released on Friday. Additionally, a declining trend in bond yields supported the uptrend in gold prices. The projections of increased physical demand from India, the world's second-largest gold consumer, were further buoyed by the government's reduction of its gold import tax from 15% to 6%.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery rose by $8.40 or 0.34% to $2,415.70 per ounce.
Technical Levels:
Pivot: $2,391.29 (for the US Session)
Supporting reasons: Identified as a pullback resistance level, indicating a potential area where sellers could enter the market after a retracement.
1st Support: $2,361.72
Supporting reasons: Identified as an overlap support level, specifically at the 161.80% Fibonacci Extension and 78.60% Fibonacci Retracement, indicating Fibonacci confluence and suggesting a significant area where previous declines have found support.
1st Resistance: $2,423.81
Supporting reasons: Identified as an overlap resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.
Key Points:
Gold futures rise amid stronger dollar and anticipation of Fed rate cut, investors await key US economic data.
Increased physical demand from India buoyed by reduced gold import tax.
Action: Gold prices could potentially react bearishly off the pivot 1st Support at 2383 targeting 2361 which invalidates above 2408
Support and Resistance Levels:
