#Gold Technical Analysis# 24K99 News, spot gold maintained a moderate increase during the Asian session on Tuesday, and currently the price is around 2334 US dollars/ounce. On this trading day, investors will focus on the speech of the Federal Reserve Chairman Powell. In addition, the US JOLTS job vacancy data will also be highly concerned. It is expected that these two factors will cause a major situation in the gold market.
FXStreet analyst Christian Borjon Valencia pointed out that despite the rise in the US dollar and US bond yields, the price of gold still rose on Monday, and gold traders are waiting for the speech of the Federal Reserve Chairman Powell.
Spot gold closed up 0.22% on Monday, at 2331.52 US dollars/ounce.
Jim Wyckoff, senior market analyst of Kitco Metals, said: "We have seen some short covering by short-term futures traders, and spot market traders are buying on dips. Stabilizing crude oil prices and a weaker dollar also provide support to the market."
At 21:30 Beijing time on Tuesday, Federal Reserve Chairman Powell will deliver a speech at the Central Bank Forum held by the European Central Bank.
Valencia said that traders are focusing on Federal Reserve Chairman Powell's speech on Tuesday and the latest minutes of the Fed's monetary policy meeting on Wednesday. After that, US economic data will include the service PMI of Standard & Poor's and ISM, and Friday's US non-farm employment data.
CME's "FedWatch Tool" shows that the probability of the Fed cutting interest rates by 25 basis points in September is 59.5%, higher than 58.2% last Friday.
As gold does not generate interest, a decrease in interest rates can increase the attractiveness of gold to investors, thereby supporting the gold price.
At 22:00 Beijing time on Tuesday, the US job vacancy data for May will be released, with an expected value of 7.9 million.
The JOLTS job vacancy report is one of the labor force indicators that US Treasury Secretary Yellen values most when she served as the chair of the Fed. This indicator is also data that the Fed is highly concerned about in the labor market.
A report on job vacancies and labor mobility surveys (JOLTS) released by the US Bureau of Labor Statistics in early June showed that the decline in the number of job vacancies in April was greater than expected, and the number of job vacancies decreased to 8.059 million, a decrease of 296,000 from the end of March, the lowest level since February 2021.
Although the US labor market has shown some resilience in the past few months, analysts generally believe that due to persistent high interest rates, the market has begun to show fatigue.
How to trade gold?
FXStreet analyst Christian Borjon Valencia said that the price of gold still tends to rise, but is still oscillating between 2320 US dollars/ounce and 2350 US dollars/ounce. Although the bearish head and shoulders pattern still exists, the momentum has turned neutral, and the relative strength index (RSI) has rebounded to the 50 neutral line, indicating that neither buyer nor seller has yet controlled the situation.
Valencia said that in order to continue to be bearish, the seller needs to push the gold price below 2300 US dollars/ounce. Once completed, the next support level will be the low point of May 3, which is 2277 US dollars/ounce, followed by the high point of March 21, which is 2222 US dollars/ounce.
If the gold price falls below the above-mentioned level, the gold price will further decline, and the seller will target the head and shoulders pattern target of 2170-2160 US dollars/ounce.
(Spot gold daily chart source: FXStreet)
Valencia added that on the other hand, if buyers intervene and attack 2350 US dollars/ounce, the gold price will target more key resistance levels, such as the cycle high point of June 7, 2387 US dollars/ounce, and then challenge 2400 US dollars/ounce.
At 10:08 Beijing time, spot gold reported at 2334.10 US dollars/ounce.