Gold is supported by lower expectations of interest rates

XAUUSD Trade idea

Gold, which posted its biggest weekly gain since April as the dollar weakened and interest rate hike expectations eased, was boosted by declining inflation data.
Gold prices hit a one-month high for their biggest weekly gain since April. The rise comes as markets cut expectations of further U.S. interest rate hikes, sending the dollar to its lowest level in more than a year. This devaluation of the dollar makes gold more affordable for foreign investors, boosting demand and pushing up the price of the precious metal.

Fundamental Bias for gold is Bullish, Forecast is bullish too. check it on Ziwox Terminal

Gold data by Ziwox Terminal

Slower PPI growth dampens rate hike expectations

Slower PPI growth dampens rate hike expectations
Recent data on US economic indicators reinforce the shift in sentiment. US producer prices barely rose in June, indicating a deflationary phase in the economy. The lower-than-expected inflation rate and the decrease in the main producer prices have reduced the possibility of a sharp increase in interest rates by the Federal Reserve. Economists polled by Dow Jones had expected the June producer price index to rise 0.2 percent, but the actual figure was a weaker-than-expected 0.1 percent.

The decline in CPI reflects softening inflationary pressures

In addition, the consumer price index registered an annualized rate of 3% in June, the lowest level since March 2021 and below consensus expectations. These figures indicate a reduction in inflationary pressures, which further reduces the possibility of an immediate increase in interest rates.

Tight labor market

In a surprising twist, the number of Americans who filed new claims for unemployment benefits fell last week, signaling the continued tightening of the U.S. labor market. These positive data add to mixed signals about the economy and the appropriate course of action for the Federal Reserve.

Baezer’s expectations July meeting

While Federal Reserve Chairman Christopher Waller remains supportive of more rate hikes this year, sentiment among investors has shifted. Expectations for further hikes have eased, with the focus now turning to the Federal Open Market Committee’s upcoming meeting in July.

However, if the Federal Reserve hints at further interest rate hikes, it may cause concern among gold investors. And this is the only risk for gold buyers. Higher interest rates increase the opportunity cost of holding non-yielding bullion, potentially causing some investors to reconsider their positions.

Does gold reach $2,000 again?

Looking ahead, gold’s bullish momentum seems intact and experts suggest that the next key levels could be between $1988 and $2000. The short-term outlook has changed, creating bullish sentiment for gold prices.

Conclusion

Short-term outlook: A weaker dollar adds to the bullish outlook
As a result, gold prices benefited from a weaker dollar and reduced expectations of a sharp increase in interest rates in the United States. Recent economic data points to a phase of deflation that will increase a more accommodative approach by the Federal Reserve. While uncertainty persists, gold investors remain bullish, eyeing the potential for further gains in the near term.
The level of 1955 was suitable to enter a buy trade, but at the time of writing this analysis, the price has risen slightly. Therefore, we have to wait for the price to break above 1960 to enter the buying transaction. It will be aimed at 1970 and 1985 buyers. Potential support has been identified at 1941

Gold is supported by lower expectations of interest rates by Alisabbaghi on TradingView.com


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GOLD, Long for a short period

After a 1% decrease in the previous days, gold rose to about 2013 dollars due to the depreciation of the dollar on the eve of the release of key US inflation data.
Traders now know that the Federal Reserve is 70 percent likely to raise interest rates by another 25 percent in May.
Data released last week showed US employers continued to hire at a strong pace in March, while the International Monetary Fund said in a report on Monday that interest rates in the US and other industrialized nations will return to very low levels. Financial markets have been pessimistic about the U.S. economy since some U.S. banks collapsed in March. Elsewhere, data on Saturday showed that consumer inflation in China, the biggest consumer of bullion, fell to an 18-month low in March. The past has arrived.
Gold is in an Over Bought area but We expect a short-term rise for gold. From the technical point of view, the broken 2003 and Polk at that level can provide a good opportunity to enter into a purchase transaction.
Falling below the 1988 level can invalidate the buying scenario.
The resistance levels of 2021 and 2032 can be your first profit limit.

Gold Long idea by Alisabbaghi on TradingView.com


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