#Gold Technical Analysis# According to FXStreet, during the late Asian session on Thursday (January 15), spot gold maintained a significant intraday correction trend. The current gold price is around USD 4,585 per ounce, with an intraday plunge of over USD 40. Analyst Akhtar Faruqui from FXStreet published an article analyzing the technical performance of gold prices.
Faruqui noted that gold prices retreated after hitting a record high of USD 4,643 per ounce in the previous trading session. Due to stronger-than-expected US Producer Price Index (PPI) and retail sales data, along with a decline in the unemployment rate last week, markets widely anticipate that the Federal Reserve will keep interest rates unchanged in the coming months, leading to a weakening of non-interest-bearing gold.
Data released by the US Census Bureau on Wednesday showed that retail sales in November increased more than expected, reaching USD 735.9 billion, with a month-over-month growth of 0.6%, surpassing market expectations of a 0.4% increase. Meanwhile, PPI in November performed strongly, with both headline PPI and core PPI growing by 3% year-over-year.
Following the release of the US employment report last Friday, analysts at Morgan Stanley postponed their previously expected rate cuts from January and April to June and September.
Faruqui pointed out that the easing of geopolitical concerns also weighed on the price of the safe-haven asset gold. According to Reuters, President Trump stated that reports indicated killings related to Iran’s crackdown were decreasing and there was no plan for mass executions. However, he did not rule out the possibility of military action by the US, noting that Washington would continue to closely monitor developments.
Spot gold closed up $39.91 on Wednesday, rising 0.87%, at $4,626.54 per ounce; prices reached an intraday high of $4,642.94 per ounce, setting a new historical record.
From a technical perspective, Faruqui mentioned that daily chart analysis shows gold prices are still within a forming ascending wedge pattern. This pattern indicates weakening upward momentum and suggests a potential bearish reversal if prices break below the downward trendline on higher trading volumes.
Faruqui noted that gold prices remained above the rising nine-day Exponential Moving Average (EMA), sustaining the short-term upward trend. The 50-day EMA continued to rise, further reinforcing the overall bullish trend. The 14-day Relative Strength Index (RSI) stood at 66.05, remaining positive but not entering overbought territory. If momentum weakens, the RSI may retreat towards the midpoint, but maintaining a high level implies continued upward pressure.
(Daily chart of spot gold, source: FXStreet)
Faruqui highlighted that immediate resistance for gold prices lies at the historical high of USD 4,643 per ounce, followed by the upper boundary of the ascending wedge (approximately USD 4,660 per ounce). A breakout above this confluence resistance zone could push gold prices to USD 4,700 per ounce. On the downside, initial support is located at the nine-day EMA (USD 4,535.64 per ounce), followed by the lower boundary of the ascending wedge (approximately USD 4,490.00 per ounce).
As of 13:38 Beijing Time, spot gold was trading at USD 4,585.30 per ounce.
