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11.09.202410:27 Forex Analyse & Reviews: XAU/USD: gold to lose in value if US inflation stays flat or rises

Today, all markets without exception are focused on the release of US inflation data, which will help market participants understand whether the Fed's rate cut on September 18 will be a one-time event or the start of a cycle of monetary easing. Currently, the market believes that the easing will be systemic, but everything could change if the decrease in inflation is minimal or, conversely, if inflation rises above the current 2.9% annual rate.

The dynamics of the precious metal will be entirely dependent on the outlook for the Fed's monetary policy easing. If the central bank moves toward a rate-cutting cycle, gold prices will rise, bearing in mind the current geopolitical challenges. A one-time rate cut could trigger a correction in gold prices within the established range of $2,473.60-2,528.30.

Technical outlook and trade idea

Exchange Rates 11.09.2024 analysis

The price is above the middle line of the Bollinger Bands, above the 5-day and 14-day SMAs. The RSI is approaching the overbought zone. The Stochastic indicator is already in the overbought zone and attempting to turn downward.

If the upper border of the range does not hold amid data showing lower inflation, the price could surge toward a new historical high of $2,561.20, signaling a further uptrend. However, if there is a surprise and inflation either accelerates or decreases only slightly, we can expect a drop in gold prices within the established range of $2,473.60-2,528.30.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

Pati Gani,
Analytical expert of InstaSpot
© 2007-2024
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