GOLD Analysis
Afternoon: Gold Prices Steady at Record Highs Amid Fed Policy Speculation
Highlights:
- US economic data shows slight rise in producer prices and modest growth in unemployment claims, indicating cooling inflation and labor market.
- SPDR Gold Trust holdings increased by 0.53%, reflecting sustained investor demand for gold as a safe haven.
- Gold prices are trading above the 50-period moving average, signaling short-term bullish momentum with key support at $2542 and resistance at $2585
Overview:
Gold prices have remained near their all-time highs, supported by a weaker US dollar and ongoing speculation regarding the Federal Reserve's upcoming policy decision. Recent US economic data has provided mixed signals, with producer prices rising slightly more than expected in August, though the broader trend still indicates easing inflation pressures. Additionally, modest growth in unemployment claims suggests a cooling labor market, which further strengthens the case for monetary easing by the Federal Reserve. The International Monetary Fund (IMF) has also backed the idea of the Fed initiating a long-anticipated cycle of monetary easing during its next meeting, as inflation risks have notably diminished.
The SPDR Gold Trust, which is often used as a proxy for global gold demand, reported a 0.53% increase in holdings, now standing at 870.78 tonnes. This uptick reflects sustained investor interest in the metal as a hedge against inflation and economic uncertainty.
Market Outlook and Technical Analysis
Gold prices are currently showing bullish momentum on the hourly chart, trading above the 50-period moving average, indicating sustained strength in the near term. Traders could capitalize on this momentum by buying around $2555, targeting a rise to $2575, with a stop-loss placed below $2542.
Support and Resistance Levels:
Gold USD Support: $2542, Resistance: $2585
Gold MCX Support: ₹72,400, Resistance: ₹73,300
Key Economic Data Releases:
- Euro Zone: Industrial Production m/m
- US Zone: Import Prices m/m, Prelim UoM Consumer Sentiment, Prelim UoM Inflation Expectations
Gold continues to exhibit strength, and positive technical indicators suggest a potential further rise. Investors may remain focused on upcoming US economic data, as well as the Federal Reserve’s policy direction, which will play a key role in shaping gold’s near-term trajectory.
Support and Resistance Levels:
