#黄金技术分析 #24K99讯 traded early in the European market on Friday (May 24). Spot gold maintained an intraday rebound trend. The price of gold is currently around 2,338 US dollars/ounce. FXStreet analyst Dhwani Mehta recently wrote an article analyzing technical trends in gold prices.
Mehta pointed out that judging from the daily gold chart, the price of gold has confirmed a fall below the rising wedge, and the Relative Strength Index (RSI) turned bearish.
Spot gold closed down $50.16, or 2.11%, to $2328.41 per ounce on Thursday. Earlier, spot gold closed on Wednesday, plummeted by $42.10, or 1.74%.
What happened to gold recently?
On Thursday, following the downward trend triggered by the hawkish minutes of the Federal Reserve's May policy meeting, gold prices fell again due to stronger than expected US commercial PMI data, Mehta wrote.
S&P Global (S&P Global) said the US Composite Purchasing Managers' Index (PMI), which tracks manufacturing and service activity, jumped to 54.4 in May, the highest level since April 2022.
The data also showed that the initial value of the US Markit manufacturing PMI in May was 50.9, a two-month high. The expected value was 49.9, and the value before April was 50. The initial value of the US Markit service sector PMI in May was 54.8, a 12-month high. The expected value was 51.2, and the value before April was 51.3.
The minutes of the US Federal Reserve meeting released on Wednesday show that officials still believe that price pressure will gradually ease at least within the next few months, but they doubt whether the current level of interest rates is sufficiently restrictive. A number of officials said that if inflation soars, they are willing to support raising borrowing costs.
Mehta said that strong US data, combined with the Federal Reserve's recent hawkish remarks, continue to ease the Fed's aggressive interest rate cut bets this year, putting additional downward pressure on gold prices.
According to the Chicago Mercantile Exchange Group (CME Group) “Federal Reserve Watch” tool, bets that the Federal Reserve will cut interest rates more than once in 2024 have been drastically reduced.
Furthermore, the weakening of expectations of the Federal Reserve's interest rate cuts had a negative impact on global stock markets. The US dollar received an inflow of safe-haven funds, while the price of gold was hit.
Friday's Market Focus
Looking ahead, Mehta wrote, the gold price trend seems to remain weak. With the speech of Federal Reserve Governor Christopher Waller (Christopher Waller) and the release of US durable goods orders and consumer confidence data, the dollar has entered a bullish consolidation phase. Risk aversion spread to the Asian trading market on Friday, and the price of gold was “licking the wounds”, waiting for a new catalyst to push gold prices down the next time.
At 20:30 Beijing time on Friday, the initial value of US durable goods orders for April will be released. The monthly rate is expected to drop by 0.8%, compared to a 2.6% increase in March.
At 22:00 Beijing time on Friday, the final value of the US University of Michigan Consumer Confidence Index for May will be announced. It is expected to be 67.5. Investors will keep an eye on inflation-related data. The final value of the US 1-year inflation forecast for the University of Michigan in May is expected to be 3.4%; the final value of the 5-10 year inflation forecast is expected to be 3.1%.
On Friday at 9:35 Beijing time, Federal Reserve Governor Waller and senior hawkish official Waller will deliver speeches. Waller said on Tuesday that he needed to “see” several months of good inflation data before he could start cutting interest rates.
Analysis of the latest technical prospects of gold
Mehta pointed out that the price of gold closed below the lower edge of the five-week upward wedge on Thursday (at the time it was 2,384 US dollars/ounce), confirming that the price of gold fell below the wedge pattern.
Furthermore, the price of gold closed below the key 21-day simple moving average (SMA) of $2,347 per ounce on Thursday, while the 14-day Relative Strength Index (RSI) fell below the midline.
These technical trends indicate that the trend seems to have changed in favor of gold sellers, and it is inevitable for the gold price to test the 50-day support level of the 50-day moving average of $2,309 per ounce.
Mehta said that if it fails to maintain 2,309 US dollars/ounce, the price of gold may target the May low of 2,277 US dollars/ounce.
Looking further down, overcoming the $2,250 per ounce mentality may be a difficult problem for gold sellers.
(Spot gold daily chart source: FXStreet)
Mehta added that if gold buyers can maintain the 50-day moving average support level of $2,309/oz, then the price of gold may rebound to the 21-day moving average support resistance level of $2,347 per ounce.
Reclaiming the 21-day moving average is essential to push the price of gold to a further rebound to Thursday's high of $2,384/oz. If the gold price continues to rebound, then the 2,400 US dollars/ounce mark will be challenged.
At 15:45 Beijing time, spot gold was reported at 2338.46 US dollars/ounce.